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The AMD income assumption disappears as crypto demand decreases

– Advanced Micro Devices Inc. ( AMD.O ) on Wednesday forecasts fourth quarter earnings under estimates as the chip maker breaks with declining demand from cryptocurrency miners for its high-end graphics processors, sending its shares down 22 percent.

PHOTO PHOTO: Visitors watch motherboards appearing at the AMD Fair in the 201[ads1]2 Exhibition at TWTC Nangang Exhibition Hall in Taipei, June 6, 2012. REUTERS / Yi Ting Chung / File Photo

AMD and Nvidia, its main competitor in gaming chip market, were the biggest recipients of a cryptocurrency boom last year as miners invested in new rigs to keep pace with demand.

However, with free-fall crypto prices, mainly due to regulatory concerns, the demand for mining mining chips has been reduced.

AMD said it now expects revenues of around $ 1.45 billion, plus or minus $ 50 million, under analysts' estimate of $ 1.6 billion, according to Refinitive data.

The chipmaker said that revenue from graphics and data processing, selling Ryzen desktop processors and Radeon graphics cards, increased by 12 percent to $ 938 million.

AMD said that strong sales of Ryzen chips were partially offset by lower revenues from the graphics business, where blockchain-related GPU sales were insignificant. "The miss was due to the GPU. AMD had too high exposure to the crypto market, and they did not have a competitive line in the PC Gaming market," says analyst Kinngai Chan, Summit Insights Group.

Sales in business, built-in and semi-custom device, which made EPYC server processors dropped 5 percent to $ 715 million.

AMD said net revenue climbed to $ 102 million, or 9 cents per share, in the third quarter ended September 29th from $ 61 million, or 6 cents per share, one year earlier.

Excluding AMD 13 cents per share, narrow striking estimates.

Revenues rose to $ 1.65 billion but lost estimates of $ 1.7 billion.

AMD shares that have more than doubled this year, traded 17.84 by the time. Nvidia was down 2.5 percent at $ 194.98.

Reporting of Arjun Panchadar in Bengaluru; Editing Sai Sachin Ravikumar

Our Standards: ] Thomson Reuters Trust Principles. [19659016]

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