AMD said it expects to report an 11% sequential revenue decline; previous guidance was for a 3% increase. That implies revenue of $1.42 billion, below the Street consensus at $1.63 billion. Th company reported Q1 revenue of $1.59 billion; In Q2 2011, revenues were $1.57 billion.
The chipmaker said the lower-than-expected revenue is primarily due to "business conditions that materialized late in the second quarter, specifically softer-than-expected channel sales in China and Europe as well as a weaker consumer buying environment impacting the company's OEM business."
AMD said it expects gross margin in line with prior guidance. Operating expenses are expected to 8% less than previous guidance of $605 million "a result of tightly controlled expenses in the quarter."
The company will report results for the quarter on July 19.
AMD in late trading is down 29 cents, or 5.2%, to $5.33.
So, now the question investors face is this: Are we seeing an AMD-specific issue here? Or is there something more systemic going that will affect Intel, the PC makers and others in the PC food chain? I would note that the AMD warning follows a similar pre-announcement from disk-driver marker Seagate; that would suggest there might be something systemic going on here.