Blaming falling PC processor prices, AMD has warned that its sales and profits over the Christmas period fell short of its expectations.
In a statement late on Thursday, the chipmaker said that it would report positive operating income for the fourth quarter but that profit would be "substantially lower" than in the prior quarter.
Fourth-quarter revenue, excluding its recently acquired ATI Technologies graphics business, increased about 3 percent from the $1.33bn reported in the third quarter, AMD said. That's less than the "seasonally strong" fourth quarter that the company had predicted.
Analysts had been expecting the company to report revenue of $1.85bn and per-share earnings of 22 cents, according to Thomson Financial.
AMD said that that its margins and profits were hit by "significantly lower microprocessor average selling prices" which dampened "a significant increase in unit sales".