Bloomberg News

AMD Expects PC Processor Market to Expand About 5% This Year

February 03, 2012

(Updates with disk-drive effect in second paragraph.)

Feb. 2 (Bloomberg) -- Advanced Micro Devices Inc., Intel Corp.’s main rival in personal-computer chips, expects the market for processors to grow about 5 percent this year.

In the first half of the year, the PC market will experience “headwinds” from shortages of hard-disk drives, Chief Financial Officer Thomas Seifert said today in a presentation to analysts at the company’s Sunnyvale, California, headquarters.

PC component makers are still reeling from last year’s Thai flooding, which cut production of disk drives and rippled through the industry. AMD said last month that its first-quarter sales would decrease as much as 11 percent from the previous three months. That indicates revenue of as little as $1.5 billion, missing the $1.6 billion predicted by analysts in a Bloomberg survey.

AMD is aiming for a gross margin -- the percentage of sales remaining after deducting the cost of production -- of 44 percent to 48 percent. That target excludes certain costs. The company also said it’s readying an “ultra-low power” chip for tablet computers this year.

AMD shares rose 1.1 percent $6.98 at 2:52 p.m. in New York. The stock has climbed 29 percent this year.

--Editors: Nick Turner

To contact the reporter on this story: Ian King in San Francisco at ianking@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles@bloomberg.net.


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