AMD suffers Q2 profit drop

By Allie Coyne on Jul 20, 2012 10:22 AM
Filed under Hardware

Market claims another victim.

Chip maker AMD has suffered under a weakening computer market, posting a net income drop of $US24 million ($A23 million) in its second quarter of 2012.

AMD posted $US37 million profit in its last quarter, down from $US61 million in the previous corresponding period. 

AMD’s president Rory Read said less demand from both consumers and the channel, alongside a weak global economy, made selling AMD’s desktop processors in China and Europe ‘challenging’. 

"We are taking definitive steps to improve our performance and correct the issues within our control as we expect headwinds will continue in the third quarter as the industry sets a new baseline,” Read said.

“We remain optimistic about our core businesses as well as future opportunities with our competitively differentiated next-generation APUs.

"Our recently launched Trinity APU continues to gain traction with customers. We are committed to driving profitable growth."

AMD’s Computing Solutions revenue dropped 13 percent year-over-year. 

The company's shares fell over 5 percent in after-hours trading.

AMD’s main rival Intel similarly suffered a 4 percent drop in profit for its second quarter, also downgrading its forecast for the 2012 financial year ahead of shrinking consumer demand for personal computers.

Intel's second quarter 2012 results, released earlier this week, show net income dropped to $US2.83 billion, compared to $US2.95 billion from the same period in 2011.

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