Advanced Micro Devices (AMD) fell to the lowest price in almost three years after predicting a revenue decline amid market-share losses and diminished demand for personal computers. AMD shares dropped 12 per cent to $4.26 in New York on Friday. Earlier they touched $4.20, the lowest price since September 2009. The stock has decreased 10 per cent this year. Shares of chipmaker Freescale Semiconductor and Rambus, which handles chip design, also declined. Demand for AMD’s products is being hurt by slower growth in China, the second-largest economy, and a worsening economic climate in Europe, the company said. AMD, the second-biggest maker of processors for PCs, also lost market share to Intel, which reported growth from the first quarter, according to AMD Chief Executive Officer Rory Read. “Our performance in the quarter was disappointing and did not meet our commitments,” Read told analysts on a conference call. “It is clear that the overall PC market experienced softness.” Third quarter sales will be down 1 per cent, plus or minus 3 per cent, from the prior period, AMD said on Friday. At the low end, that prediction indicates revenue of $1.36 billion in the third quarter, compared with the average analyst estimate of $1.41 billion, according to data compiled by Bloomberg. AMD’s sales have grown 14 per cent on average from the second quarter to the third over the past 10 years, according to Mike Burton, an analyst at Northland Capital Markets. Notebooks and servers Market share losses in notebooks and a lack of demand for AMD’s new server products, which would improve its profitability, prompted Wedbush Securities analyst Betsy Van Hees to lower her rating on the stock to neutral from outperform, she said in a research report yesterday. MKM Partners’s Daniel Berenbaum, who has a sell rating for AMD, said the earnings report shows that poor execution and a wider market share loss than he had expected. “Investors seemed willing to give CEO Rory Read the benefit of the doubt, but one year into his tenure it is becoming increasingly difficult to believe that a fix can be arrived at by simply “improving execution”, Berenbaum said in a report yesterday. Last year, AMD suffered a steeper decline in orders than it had expected because of a failure to supply new chips to distributors. Those customers now need to be persuaded that AMD will now deliver on its supply commitments and that its new products are attractive, compared with the competition, Read said. Falling Profit In the second quarter, AMD posted a profit of $37 million, or 5 cents a share, down from $61 million, or 8 cents, a year earlier, the Sunnyvale, California-based company said in a statement. Sales fell 10 per cent to $1.41 billion. In April, the company had predicted a gain of as much as 6 per cent from the first quarter. Freescale Semiconductor, a maker of chips used in cars and phone systems, tumbled as much as 14 per cent after the company forecast third-quarter revenue that missed analysts’ estimates. The stock fell 6.6 per cent to $9.54 in New York, after earlier trading as low as $8.79, for the biggest decline since April 20. Shares of the Austin, Texas-based company had declined 19 per cent this year through yesterday. Third-quarter revenue will be $955 million to $1.01 billion, according to a company statement yesterday. That compared with an average estimate of $1.05 billion, according to data compiled by Bloomberg. Sunnyvale, California-based Rambus Inc., which designs computer-memory chip interfaces, fell the most since November after reporting that its second-quarter net loss tripled to $32.2 million as sales slid 15 per cent to $56.2 million. Results are suffering from lower technology licensing rates as demand for computer memory ebbs, according to a report by BWS Financial Inc. analyst Hamed Khorsand. The stock plummeted 17 per cent to $4.31 in New York trading. It has shed 31 per cent this year. From gulfnews