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AMD's bad prospects, encryption of encryption chips intensify swimming in the semiconductor sector




Chip maker Advanced Micro Devices Inc. reinforced the market jitters about the semiconductor industry Wednesday, announcing that it has a part of graphics pieces that are no longer a hot item among cryptocurrency miners.

On Wednesday, AMD

-9.17%

AMD, -9.17%

reported a small revenue for the third quarter and a weak quarterly forecast and sent its recently hot shares to tumbling over 25% in post-trade. The news of a layer of graphics processors, on top of a weak forecast, seemed to confirm to investors that anyone hopes for winnings from Intel Corp. s

INTC, -4.67%

Manufacturing errors may not be as great as expected.

The company said its Epyc server chips continued to build and maintain a target to reach 5% of the Intel-dominated market. But data center gains were not enough after AMD revealed GPU gluten, which appeared to stem from the same decline Nvidia Corp.

NVDA, -9.79%

reported in August.

More from Therese: Why AMD thinks it can challenge Intel in servers.

AMD's Managing Director Lisa Su told analysts that the graphics industry's business was down at around $ 100 million more than expected as crypto-mining sales cooled.

"We expected the segment to be down, but we expected it to be about [$50 million] or so," said Su, when the actual case was 150 million dollars. "And if you look at the difference from when we started the quarter, it's the whole GPU channel."

In the fourth quarter and first quarter of 2018, AMD saw significant increases from the sale of graphics chips to crypto-currency miners. In the first quarter, AMD said that crypto-mining-related sales were about 10% of their total revenue, a larger share as it had seen in previous quarters. But in August, after a steep decline in the price of Bitcoin

BTCUSD, -0,63%

Nvidia said that the cryptoboom was over and no further contribution was expected to be made.

Not to be missed: This chip maker has just set a warning flag for the whole sector

"The disappointment is all the crypto-GPU overhang," Christopher Rolland, an analyst from Susquehanna Financial Group who predicted Hovvind in GPU, said in an email. "Since the eatery

ETHUSD, -1.32%

prices have fallen. The channel is full of GPU fixtures. "

The cryptofall, while it was larger than expected, was not a shock after Nvidia's warning, though. The big surprise was a forecast that did not contain big gains while major competitor Intel is facing supply constraints on the PC chip production process. 19659002] Opinion: Carl Icahn is entitled to Dell's complex self-propelled attempt to enter the public market

Sus's most direct comment about the opportunity to take advantage of Intel's accidents was that AMD saw someone pockets of constraints in the supply chain around PCs. "We saw it towards the end of the third quarter," said Su. "We are increasing our production so that we can meet any of that demand. And I think it's a short-term statement. "

Any chip maker talking about an inventive glut and demand weakness will be considered hard in this environment where fear of a downturn in the track was already stoked a day earlier by Texas Instruments Inc.



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