AMD revises its third quarter revenue forecast

By Lee Kaelin on September 29, 2011, 9:30 AM

AMD has revised its revenue projections for the third quarter ending October 1, citing issues with 32nm chip production at its German Foundry. The second largest PC chip manufacturer now expects its revenue to increase by 4-6% on top of their second quarter earnings, down from the 10% they forecasted earlier in the year. In response to the news, shares fell by 7.8% to $5.88 during extended trading yesterday.

Besides the yield issue with 32nm chips, AMD commented that its 45nm chip supply was also having problems as the two processes share some common tools in manufacturing.

The Dresden based manufacturing firm GlobalFoundries, in which AMD has an 11% stake, is used for the company's manufacturing operations. Poor yield of chips due to production problems appears to be the biggest issue for the chipmaker.  The plant is "throwing substantial resources at improving yields," said Drew Prairie, a spokesperson for AMD. The company says they're seeing progress, but quite how much remains unclear.

These production problems have led to a shortage of "Llano" fusion chips for mainstream computers, and have caused delays to the shipping of new server-grade 16 core Opteron "Interlagos" CPUs, which will further affect sales margins.

These latest news will do little to quash the concerns of many enthusiasts growing steadily impatient at the continuous delays to Bulldozer CPUs, which are not expected until mid-October. Rumors are beginning to appear hinting at an October 12 release date but many will be concerned whether AMD can keep up with demand.

User Comments: 4

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Raswan Raswan said:

Should I expect Intel to come out with a commercial with the slogan "Ready. Willing. Able to make so many f$cking chips that you will drown in them" about two months after AMD fixes these production problems? Or is it just AMD who writes awkward commercials and runs them too late for it to do any good?

Route44 Route44, TechSpot Ambassador, said:

This explains a whole lot like why NewEgg has been without the highest end Llano A-3850 for quite some time now.

I support AMD but they shoot themselves in the foot again and again. This would help explain even more so why Rick Bergman is no longer around.

This also does not bode well for Bulldozer. Not at all.

SammyJames said:

raswan said:

Or is it just AMD who writes awkward commercials and runs them too late for it to do any good?



SammyJames said:

And about that last comment -- don't take it the wrong way -- I wasn't trying to be funny or mean or anything. I was seriously wondering about this.

I had a thought about AMD versus Intel last night. My thought was something along the lines of, "Intel products typically cost more, but they are also typically on the bleeding edge, and they also advertise constanlty on television. AMD occasionally leapfrogs, but I've never, EVER seen an AMD commercial in my life."

That's all.

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