According to AMD, the lower outlook is a result of weaker Client segment revenue. AMD also notes that Data Center, Gaming, and Embedded Segment each grew significantly, and in line with the company's expectations.

According to AMD, third-quarter revenue is expected to be around $5.6 billion, which is still an increase of 29 percent compared to the last year. The gross margin should be around 42 percent (50% non-GAAP). The shortfall was due to both lower revenue driven by lower Client processor unit shipments and average selling price (ASP). On top of it, Q3 results will also include around $160 million of charges for inventory, pricing, and related reserves in the graphics and client businesses.

“The PC market weakened significantly in the quarter,” said AMD Chair and CEO Dr. Lisa Su. “While our product portfolio remains very strong, macroeconomic conditions drove lower than expected PC demand and a significant inventory correction across the PC supply chain. As we navigate the current market conditions, we are pleased with the performance of our Data Center, Embedded, and Gaming segments and the strength of our diversified business model and balance sheet. We remain focused on delivering our leadership product roadmap and look forward to launching our next-generation 5nm data center and graphics products later this quarter.”

AMD will hold its financial conference call on November 1st where it will provide full details on each of the segments as well as its outlook for Q4 2022.