In the semiconductor industry, several players have suffered from the weakening computer market. Advanced Micro Devices (AMD) has therefore readjusted its sales expectations. The Californian foundry is now expecting a decline. Its sales are expected to decrease by about one billion dollars compared to April-June 2022.
AMD is expected to release its Q3 2022 financial results by the end of the month. At the beginning of October 2022, the founder said it feared underperformance in that period. Its boss, Lisa Su, said in a statement that the computer market has slowed down significantly during these 3 months. She explained that this situation will not allow them to achieve their goals between July and September 2022.
Note: this weakening of the PC market could affect the activity of some professionals with IT freelance status . This device refers to the form of employment of self-employed persons in the computer industry.
Other founders share the same concern
In the details, AMD’s Q3 2022 revenue is expected to be euro5.6 billion. That’s euro1.1 billion less than originally projected. This would mean that revenue would plummet by 15% in Q2 2022. Growth expected to be 55% year-on-year would drop to 29%. .
In the chip market, other players, like AMD, are expecting worse results than expected. Nvidia and Intel meanwhile, are bracing for significantly weaker sales in their current quarters. The Philadelphia Semiconductor Index has suffered a 36.4% decline this year after rising about 40% in 2021.
Early this month, Micron also warned investors that it had fallen on hard times and would cut its spending by a third. This is in order to maintain its profitability .
Samsung, for its part, warned that its operating profit would be euro7.6 billion. It would then collapse by some 31% compared to 2021. The Korean multinational would thereby record its first year-over-year earnings decline since January-March 2020 . A period that marked the beginning of the health crisis. Revenues between October and December 2022 are promised to grow by +2.7% to reach euro53.9 billion.
The firm is most concerned about the results of the consumer business
This more serious than expected decline in demand in the PC market was the result of macro-economic parameters. Lisa Su detailed that it resulted from the Russian-Ukrainian conflict, the energy crisis, Covid-19 and inflation . She continued that even though their product portfolio remains extremely strong, this drop has caused :
[…] A major inventory correction throughout the PC supply chain.
Preliminary results reveal that the strongest unscrewing is observed on the ” Customer”. Its revenues in Q3 2022 are expected to be down 53% quarter-on-quarter and 40% year-on-year . The “Data Center” division is enjoying a better performance, with a 45% year-on-year increase. The “Gaming” division closed the July-September 2022 fiscal year with an anticipated annualized increase of 14%.
AMD cites several causes such as lower average selling rates and chip shipments as reasons for its rout. After this alarm, its stock lost about 4%. This has led to the decadence of other founders such as Nvidia and Intel, whose shares have fallen by approximately 2% .