AMD tracks down Intel, warns PC market is collapsing | Tech Rasta


The hot PC market is slowing sharply after skyrocketing during the COVID-19 pandemic, and chip players in powerhouse AMD and Intel are in financial pain.

“We have taken a more conservative view of the PC business,” AMD CEO Dr. Lisa Su said in an earnings call on Tuesday. “Last quarter we used to think the PC business would collapse. [percentage]And our current view of the PC business is that it will fall into the so-called mid-teens. [percentage]”

Weaknesses in PCs made it difficult for AMD to predict a worse-than-expected Q3. Despite estimating continued strength in chip sales for data centers, AMD posted third-quarter sales of $6.5 billion to $6.9 billion, The Street forecast $6.8 billion sales, AMD forecast margins. Third-quarter gross at 54%, slightly below the 54.2% forecast.

AMD shares fell more than 2 percent in early trading Wednesday. The company’s most-visited ticker page on Yahoo Finance highlights investor concerns about AMD’s outlook, including a warning that pressure on the PC market will continue in the quarter. four

A man checks a power cable on a laptop's motherboard at a repair center in Colombo, Sri Lanka October 17, 2017. REUTERS/Dinuka Liyanawatte

A man checks a power cable on a laptop’s motherboard at a repair center in Colombo, Sri Lanka October 17, 2017. REUTERS/Dinuka Liyanawatte

AMD’s warning comes after Intel competitor Intel told investors earlier that it expects the total addressable market for PCs to plummet 10 percent this year amid shocking second-quarter results and adjustments. Reduce full-year earnings guidance

“We are seeing significant inventory revisions on the part of our customers,” Intel CEO Pat Gelsinger said on Yahoo Finance Live.

Gelsinger said he believes the third quarter was the lowest point for his business, with a better outlook in the fourth quarter due to holiday PC purchases.

Intel shares smashed 8 percent on Friday after disappointment.

Dour’s comments from the two chip giants shed further light on the challenging environment for PC manufacturers and their suppliers. The cuts in PC spending also increased the risk of a dull quarter and trends from computer makers Dell and HP as they reported in the coming weeks.

Global traditional PC shipments fell 15.3% year-on-year to 71.3 million in the second quarter, according to data from IDC. This is the second quarter of the decline in PC shipments after two years of growth.

“PC inventory editing can be done. [continue] In our view, several quarters Because the supply chain level of PCs in the supply chain is over 20 years,” Baird analyst Tristan Gerra wrote in a note to customers. “Transforming consumers away from home entertainment devices during this time of coronavirus. plus weakness season in the first half Indicates that there is no short-term recovery of the PC. As a result, the utilization rate is too low, challenging the recovery in gross margins.”

Brian Sozzi is the editor-in-chief and Announcer at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and next LinkedIn.

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