SUNNYVALE, Calif. (TheStreet) -- AMD's (AMD) new CEO Rory Read will oversee his first quarterly earnings after the market close on Wednesday with investors keen to hear his plans for revitalizing the No. 2 chipmaker.
|AMD reports its third-quarter results after market close.|
AMD lowered its third-quarter sales forecast last month, citing manufacturing issues that limited supplies of its Llano chip."There will definitely be a spotlight on Read," Sergis Mushell, principal research analyst at Gartner, told TheStreet. "This is really the conference call for him to set forth what happens [to AMD] moving forward -- there are several markets where he needs to clearly state where the company is going." The server market, where AMD was once the leader, will likely prove a key area of focus, according to the analyst. "They need to get into some of the major data centers like Google (GOOG)," he said. "The majority of these data centers today are building their own servers -- a well executed plan there will result in imminent success." Former IBM (IBM) and Lenovo executive Read joined AMD in August, ending the company's seven-month search for a permanent chief after the ouster of former CEO Dirk Meyer earlier this year. Prior to joining AMD, Read served as COO of Lenovo. During his five-year tenure at the Chinese gadget giant, Read also led Lenovo's entry into the tablet and smartphone markets. Gartner's Mushell thinks that Read may spell out AMD's tablet strategy, particularly after Microsoft (MSFT) endorsed the chipmaker, along with the likes of Intel and Nvidia, for its Windows 8 operating system. The new CEO should also focus on AMD's strong legacy in graphics chip technology, he added. "AMD needs to work out where their CPU and graphics strength will be combined," explained the analyst. "They need to have a vision for their graphics division and work out what's next." Inevitably, Read will also face questions on the production problems that forced the company to revise its third-quarter sales forecast. AMD blamed its lowered numbers on yield, ramp and manufacturing issues at a GLOBALFOUNDRIES factory in Dresden, Germany that limited supply of its 32-nanometer chip. This weighed heavily on AMD's stock, which has traded down more than 27% his year. Thanks to the manufacturing problem, AMD expects its third-quarter revenue to increase just 4% to 6% year over year, well below its prior forecast of 8% to 12% growth. Analysts surveyed by Thomson Reuters are looking for AMD to post sales of $1.65 billion and earnings of cents a share, compared to $1.62 billion and 15 cents a share in the same period last year. AMD shares were up 23 cents, or 4.42%, at $5.32 on Thursday. --Written by James Rogers in New York >To follow the writer on Twitter, go to http://twitter.com/jamesjrogers. >To submit a news tip, send an email to: email@example.com.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV