Lisa Su, president and CEO of Advanced Micro Devices (AMD), holds a 3rd Gen Ryzen desktop processor during her keynote speech at the Consumer Electronics Show 2019 (CES) in Las Vegas, January 9, 2019.
David Paul Morris | Bloomberg | beautiful pictures
AMD shares fell more than 7% on Friday as investors announced the semiconductor disappointment preliminary results for the third quarter of Thursday much lower than its original instructions.
The chipmaker cut its sales forecast on Thursday for the third quarter, due to a larger-than-expected decline in the personal computer market and supply chain issues.
AMD now expects preliminary quarterly revenue of about $5.6 billion thanks to “decreased processor shipments.” That’s $1 billion less than the $6.7 billion the company had previously forecast as the midpoint of its revenue expectations for the quarter.
The company also said its non-GAAP gross margin is expected to be around 50%, while it previously expected a gross margin of close to 54%.
Several companies, including Piper Sandler, Stifel, KeyBanc Capital Markets and Mizuho Securities cut their price targets for AMD in their notes to clients on Friday, though each maintained their buy or overweight.
Shares of other chip makers such as Intel and Nvidia also fell, about 4% each, as weak PC demand and supply chain issues could weigh on other semiconductor players.
WATCH: AMD’s third-quarter cuts were deeper than the market expected, says Bernstein’s Stacy Rasgon
