AMD on Monday revised its revenue forecast for the second quarter. The company now expects revenue to drop by 11 percent from the first quarter due to slow sales in China and Europe.
The company previously forecasted second quarter 2012 revenue to increase 3 percent, plus or minus 3 percent sequentially. AMD said the lower preliminary revenue results are 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 Original Equipment Manufacturer (OEM) business.
AMD expects second quarter gross margin to be approximately in line with prior guidance. Operating expenses for the second quarter are expected to improve and to be approximately 8 percent less than prior guidance of approximately $605 million, a result of tightly controlled expenses in the quarter.
AMD released its new Trinity chips for PCs in the second quarter, and had expected those and other products to help expand its sales.
The PC market has been growing at a slower-than-expected pace, with more interest in tablets and smartphones for computing. Analysts have predicted weak PC sales growth in the second quarter.
AMD's business is largely conducted at the consumer level, so it'll feel a larger impact than rival Intel.
AMD will report second quarter 2012 results after market close on Thursday, July 19, 2012.