Advanced Micro Devices Earnings Preview: Worst Quarter In Years?

Shares of Advanced Micro Devices, Inc. AMD fell more than 4 percent on Wednesday, ahead of the company’s second quarter results scheduled for after the market closes on Thursday. The quarter is expected to bring a huge decline in earnings, to negative territory.

In the second quarter of 2014, the chipmaker reported earnings of $0.02 per share on revenue of $1.441 billion. In the last quarter, it registered a net loss of ($0.09) per share on revenue of $1.03 billion.

For the current quarter, the Street is modeling a consensus net loss of ($0.16) per share on revenue of $956.97 million (Estimize data). Meanwhile, the crowd is slightly less bearish, and projects a net loss of ($0.13) per share on sales of $1.023 billion.

Moreover, it should be noted from the chart above that AMD has been consistently missing estimates over the past year.

Related Link: 'A Hard Rain's A Gonna Fall' Come Intel And AMD Earnings, Bernstein Warns

The second chart illustrates the evolution of sentiment over time. Both the Street and the crowd have become increasingly bearish on results as the earnings call loomed. Consensus estimates now stand at their lowest.

Also pessimistic about AMD’s results are Bernstein analysts Stacy Rasgon, Shirley Hu and Yang Ren, who anticipate a net loss of ($0.15) per share for the second quarter. The experts are modeling revenue of $953 million, down 8 percent quarter-over-quarter, but in line with management’s revised guidance.

Bernstein notes that “AMD is at a tipping point, with their core PC business under significant pressure from a weak market and increasingly poor competitive position.”