SUNNYVALE, Calif. -- Price pressures in the x86-based processor market from Intel Corp. and other factors forced Advanced Micro Devices Inc. here today to lower its forecast in the second quarter of this year.
AMD warned that sales for the quarter will hit $985 million, a decline of approximately 17%, compared to the first period of this year. On a continuing basis, AMD's sales will decline by 11%, compared to the like period a year ago.
The Sunnyvale-based company also estimated that its second-quarter net income will range from $0.03-to-$0.05 per diluted share. The company was supposed to earn about $0.27 a share, according to First Call/Thomson Financial.
When it announced first quarter results on April 18, AMD also projected that second quarter sales could decline by as much as 10%.
AMD said that two factors caused the greater-than-expected decline during the second period. First, demand for flash memory devices continues to be weaker than anticipated.
Second, competitive pressures from Intel depressed the average selling prices (ASPs) for AMD's x86-based processors. In recent months, Intel has bombed the prices for its flagship Pentium 4 processor lines by as much as 50%--a move that is designed to gain market share and fend off competitive threats from AMD.
But still, AMD claims to have achieved record unit sales of its Athlon and Duron processors in the quarter.
AMD will report its second quarter results on July 12.
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