Chipmaker Advanced Micro Devices Inc on Thursday released third-quarter revenue estimates about $1 billion lower than previous forecasts, indicating the microprocessor sector’s downturn could be much worse than expected.
Shares of AMD fell 4% in trading on electronic platforms after the close of the regular session in the United States, dragging down the sector in Europe on Friday, with the STOXX 600 technology index falling 1.4%.
Also contributing to this drop was Samsung’s announcement of much lower-than-expected profits.
“The PC market weakened significantly in the quarter,” CEO Lisa Su said in a statement, adding that macroeconomic conditions caused demand for PCs to be lower than expected.
Rampant inflation and the reopening of offices and schools have led people to spend less on personal computers than during lockdowns, when many bought computers for work and school while staying home during the pandemic.
Chipmakers are also under pressure from COVID-19 restrictions in a key market for the sector, China, while the war in Ukraine has worsened supply chain problems and dragged down demand.