Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of embattled chip maker AMD (NYSE: AMD ) sank 14% today after its preliminary third-quarter results disappointed Wall Street.
So what: AMD is just the latest in a string of PC component manufacturers that have been hurt by a weak economic environment, as well as a rapid shift toward smartphones and tablet computers. Today's downbeat guidance also suggests that AMD continues to struggle with market-share losses to chip gorilla Intel (Nasdaq: INTC ) , giving Wall Street little reason to be optimistic over its turnaround prospects.
Now what: Management now expects third-quarter revenue to decline 10% sequentially, much worse than its previous forecast of only a 1% drop. "I used to think that AMD would make it back to the big stage, and that the stock should be worth about $10 on that basis," Foolish tech expert Anders Bylund wrote yesterday. "Now, the risks outweigh the opportunity." Given the economic, secular, and competitive headwinds working against AMD, it's tough not to agree.
Interested in more info on AMD? Add it to your watchlist.
RSS Headlines
Fool UK
Comments from our Foolish Readers
Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the
Report this Comment icon found on every comment.
Be the first one to comment on this article.