AMD Share Price Drops Amid Expectations Mining Hardware Demand Will 'Level Off'
Advanced Micro Devices (AMD) has announced an estimated gross profit margin of 35% percent for the fourth-quarter of 2017. Although the announcement has revealed a lower profit forecast than anticipated by some analysts, AMD's share price has seen gains of more than 80 percent over the course of the last 12 months.
Tuesday’s Announcement Has Resulted in a More Than 13 Percent Drop in AMD’s Share Price
AMD CEO, Lisa Su, expressed her expectation that demand from cryptocurrency miners will begin to taper off this coming quarter. Su stated that the company is “predicting that there will be some leveling off of some of the cryptocurrency demand. As we look at it, it continues to be a factor, but we’ve seen restocking in the channels and stuff like that. So we’re being a little bit conservative on the cryptocurrency side of the equation.”
The Third Quarter of 2017 Was AMD’s Highest Performing Quarter Since 2011
The dramatic surge in global demand for cryptocurrency mining hardware experienced during 2017 comprised a major source of the company's earnings during the year. AMD has so far seen a 26 percent year-over-year increase in total revenue, despite other sectors of the company posting stagnant growth. Prior to Tuesday's announcement, the share price of AMD had gone up by approximately 90% during the preceding 12 months.
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