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AMD shares slip after earnings when income forecasts come to light



Shares of Advanced Micro Devices Inc. fell in the extended session Tuesday after the chip maker reported revenue that met expectations amid tariff restrictions, but revealed a revenue outlook that fell below the Wall Street consensus due to weaker-than-expected console sales.

AMD

AMD, + 1.16%

shares, which had fallen more than 5% after hours, were last down 3%, following a 1.2% increase in the regular session to close at $ 33.87. By comparison, the S&P 500 index

SPX, -0.26%

fell 0.3%, the technical heavy Nasdaq Composite Index

COMP, -0.24%

slipped 0.2% and PHLX Semiconductor Index

SOX, -0.26%

fell 0.3% in the regular session.

AMD expects third-quarter sales of $ 1.75 billion to $ 1.85 billion, while analysts had forecast an average sales of $ 1.94 billion to FactSet.

Read: Microsoft kills it in all but one

"The sequential increases and year over are expected to be driven by increasing EPYC and Radeon product sales, partially offset by lower than expected sales of "Adapted chips for gaming consoles fall into AMD's semicustomer sales.

" AMD met expectations for the quarter, but lowered its forecast based on softness in the gaming console market, "said Pat Moorhead, principal analyst at Moor Insights and Strategy, in email comments.

“I think this softness is driven by consumers being excited about the next generation of Microsoft consoles

MSFT, -0.48%

(Scarlett) and Sony (PS5) and deferred purchases, ”said Moorhead. "Support for this, Microsoft and Sony console sales recently were also down."

For more: Microsoft kills it in all but one

"In the second quarter, we stopped sending customers added to the US unit list," AMD chief Lisa Su said in the conference call. "While we remain cautious, given the situation, the impact to date has been limited and offset by increasing momentum in other parts of our business."

The company reported second quarter net income of $ 35 million, or 3 cents per share , compared to $ 116 million, or 11 cents a share, a year ago Adjusted earnings were 8 cents a share, with revenues falling to $ 1.53 billion from $ 1.76 billion the year before.

Analysts surveyed of FactSet, had projected earnings of 8 cents per share on revenue of $ 1.52 billion.


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