NEW YORK (CNN/Money) -
Advanced Micro Devices Inc. Tuesday lowered its sales forecast and said it faces a substantial operating loss in the second quarter because of broad weakness in the personal computer market that cut into the chipmaker's business.
AMD's warning came minutes before a similar one from Apple Computer Inc. (AAPL: Research, Estimates), which said its sales and profit would miss forecasts because of weakness in Europe and Japan. Additionally, after the bell Tuesday software maker Oracle Corp. (ORCL: Research, Estimates) logged a fourth-quarter profit that beat expectations.
AMD, the No. 2 supplier of chips for personal computers, said it expects sales of $620 million to $700 million for the quarter ending June 30, well below its April 17 projections for sales of $820 million to $900 million.
AMD's projections for lower sales in the second quarter would represent the company's fifth straight quarterly decline in sales, according to earnings tracker First Call. Analysts on average anticipate AMD will post a loss of 9 cents a share, compared with a profit of 5 cents a share in the year-ago quarter.
On April 17, Sunnyvale, Calif.-based AMD (AMD: Research, Estimates) posted a narrower-than-expected first-quarter loss in spite of a 24 percent drop in sales. The company's stock, which has tumbled 31 percent since then, ended down 50 cents at $10.30 Tuesday ahead of the warning.
The stock tumbled to $8.51 in after-hours trading, according to Instinet.
"As we have seen in previous statements from a number of other companies, there is broad weakness in the personal computer market and it is adversely affecting AMD," Robert Rivet, AMD's chief financial officer, said in a statement.
He noted the weakness in Europe and North America but said AMD's flash memory business is improving and is expected to show sequential sales growth.
AMD, which reports second-quarter results on July 17, said it is continuing record spending on research and development and it is proceeding well with its previously reported product and technology schedules.
The company has scheduled a teleconference later Tuesday to discuss its second-quarter sales outlook.
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