AMD updates Q2 guidance, projects 8% decline in revenues

In a press release today, AMD announced that revenues for Q2 2015 are expected to be lower than originally projected. In its now-revised estimates, AMD anticipates revenues to decrease by around 8% sequentially, compared to the 3% decline previously estimated.

Although disappointing, this isn’t entirely unexpected: AMD itself cites weak PC sales causing a reduction in shipments of CPUs and APUs, and the AMD chips sold for use in current-generation video game consoles have provided fairly slim margins for the company. Indeed, and as Seeking Alpha explains, 2015 remains a challenging year for AMD, as a restricted R&D budget (and the industry’s stagnation on the 28nm process node) has made it increasingly difficult to improve existing products, and remain competitive:

We’re definitely seeing the results of AMD’s lack of resources this year, which has been exaggerated further by the failure of partner Global Foundries to release their 20nm planar node. As I had speculated in a previous article, this has invalidated work already done by AMD at a cost of $33 million to the company. This was almost certainly why Project Skybridge was cancelled, and was likely originally the node Fury X was intended to be released on. Without the resources, AMD can only invest minor amounts in transient technologies based on 28nm.

Until we can get some hard numbers from AMD, their performance in Q2 and beyond is mostly speculative, but we won’t have to wait long to see what those numbers are: the company is set to report Q2 results just over a week from now, on July 16th.

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