AMD Q3 sales decline, bleeding continues

AMD has released its Q3 results, and the bleeding continues. In this last quarter, AMD lost $254 million on sales of only $508 million. What's more troubling, however, is the percent decline in desktop processor sales:
PC processor sales of $262 million for the quarter declined by 31 percent from the $380 million reported in the second quarter of 2002. This decline was driven by a drop in both units and dollars of microprocessors for desktop applications. AMD believes it held share in the mobile segment and gained share in the server segment.
Overall, sales declined by 34% from the same quarter last year, and by 15% from Q2 of this year. This isn't good news for AMD, whose execution of late has been lacking. In 2003, AMD needs Hammer to be huge, and average selling prices are going to have to be high if AMD wants to improve its financial position.

This week, Intel also announced its Q3 results, but its sales were unchanged from Q3 of last year, and up 3% from Q2 of this year. Intel is working with more than ten times the sales volume of AMD, and it posted a profit of $686 million.

AMD's weak financial position may mean that we won't be seeing any drastic price slashing anytime soon, which is a pity, because the holiday season is ripe for a price war.

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