Advanced Micro Devices chief executive Lisa Su said that ARM-based server chips have experienced slower-than-expected reception from the owners of data centers and server farms.
AMD delayed its own ARM-based Opteron microprocessor, code-named Seattle, until the fourth quarter of this year. ARM, which is supported by many chip makers, including AMD, is dominant in smartphones and tablets, but it is having a harder time penetrating the multibillion-dollar market for high-end server chips.
Su said in an analyst conference call that the company expects to see “modest production shipments” of Seattle in the fourth quarter. Meanwhile, AMD’s Intel-compatible “x86” server chips will be the company’s mainstay product offering for data centers.
“I view it as a longer-term bet,” Su said. “We continue our ARM efforts in a complementary way.”
AMD’s third quarter was weaker than expected. For the fourth quarter, AMD expects revenues to fall 10 percent sequentially from the third quarter, due to a seasonal decline in semi-custom chip sales. Computing and graphics segment revenue is expected to increase sequentially, and non-GAAP gross margin is expected to be at 30 percent. AMD expects cash to be flat at about $750 million. AMD is laying off about 5 percent of its staff.