Advanced Micro Devices’ Q3 Results Beat Estimates; Shares Rally (AMD)

Advanced Micro Devices Inc. (NYSE: AMD) shares rallied in trading today after the global semiconductor company reported better than expected third-quarter financial results.

Sunnyvale, California-based AMD swung to a profit in the third quarter of 2011 on the back of strong demand for chips in laptops from emerging markets like China and India. For the third quarter, AMD reported net income of $97 million, or $0.13 per share, compared with a loss of $118 million, or $0.17 per share reported for the same period in the previous year.

Excluding one-time items, the company reported earnings of $0.15 per share, beating consensus estimate of $0.10 per share.

AMD’s revenue increased 4% over the third quarter of 2010 to $1.69 billion. Analysts were expecting the chipmaker to report revenue of $1.66 billion.

AMD managed to beat Street estimates in the third quarter despite supply constraints. Last month, the company had slashed its forecast for the third quarter due to manufacturing issues at a German factory. The manufacturing problem prevented the company from making “Llano”, a new type of chip.

AMD also gave solid guidance for the fourth quarter of 2011. The company expects fourth-quarter revenue to rise between 1% and 5% on a sequential basis. This translates to revenue of $1.71-$1.77 billion for the fourth quarter of 2011. Analysts currently expect the company to report revenue of $1.72 billion for the fourth quarter of 2011.

Advanced Micro Devices shares rose to an intra-day high of $6.05 following the release of better than expected third-quarter financial results. The stock ended the day 7.22% higher at $5.94 on above average volume of 47.55 million.

AMD shares have risen almost 21% in the last three trading sessions. Despite the recent gains, the stock is still down 3.41% in the last one month.

Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.