Boston, MA 04/10/2014 (wallstreetpr) – Advanced Micro Devices, Inc. (NYSE:AMD), has witnessed 11% drop in the shares after a weak revenue forecast. It fell down in the early trading after a forecast of steeper than what-was-expected in the quarterly revenue. The overall decline in the shares has prompted at least two brokerages cutting their price targets. Weak sales of PC, high competition from Intel and the net decrease in the revenue collected from the gaming consoles are some of the reasons believed to have caused the weak forecast.
On the verge of collapsing
While the company’s processors were previously used in Microsoft Corporation (NASDAQ:MSFT) and Sony Corporation in the gaming consoles has now witnessed a decline in the shares. The quarter’s result has marked many serious reasons for concern over the company’s core business, which is the PC business. Reports suggest that the gradual decline in the company’s trading might see the collapse of the company. According to sources, the company believed, there would be a net 16% plus or minus 3% fall in the revenue in the first quarter as compared to the fourth quarter.
A steep fall in the sales
Reportedly, the sales for PC chips of the company decreased about 13% in the fourth quarter. However, AMD has been trying hard to refocus and increase the sales and trading of laptops, smart phones and tablets for the consumers. While it is gaining in the market of gaming consoles, still it has not managed to hold on to the market share in the chip business for PC. The company seems to now be exposed to the low end consumer pc section and not to the corporate pc section. As a good sign for the company, the stock has risen 24%. In the backdrop of declining shares of the company, it will be very important to see how the market does consolidate as far as the business for the pc chips and gaming consoles are concerned.
