Advanced Micro Devices, Inc. (NASDAQ: AMD) is having an incredibly rough day in the market today. However, the company hasn’t issued any press releases that would cause the declines. Nonetheless, there is a very good reason for the drop in value. Today, we’ll talk about:
- Why AMD stock is falling;
- what we’re seeing in the market; and
- what we’ll be watching for ahead.
Here’s Why AMD Is Tanking
As mentioned above, Advanced Micro Devices is having an incredibly rough day in the market today, but the company has released no news. So, what’s the deal? Well, it has to do with an issue with the company’s largest customer. That customer is Apple.
AMD stock is spiraling out of control after Apple issued a rare statement, warning investors that revenue for the holiday period would be lower than expected. In fact, it is the first statement of its kind out of Apple in around 12 years!
In the announcement, Apple said that it is now expecting for revenue in the holiday quarter to come to $84 billion, down from the previous expectation of $88.05 billion. Also, analysts expected that revenue for the quarter would come in between $89 billion and $93 billion.
As all eyes seem to be on Apple, with analysts reducing price targets and investors clammoring to sell, the move is sending shockwaves through the market, and AMD is not immune to the issue. Unfortunately, the company provides products to Apple for the sale of its iPhone, and with the iPhone demand in China shrinking, leading to the lower expectations, this is a direct hit to various companies, including AMD.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to work in the market is that the news leads to moves. When it comes to Advanced Micro Devices, while the company didn’t release any news of its own, the news released by Apple proved to be a big hit to the company. So, it’s not surprising to see that investors are upset, sending the stock tumbling down. As is just about always the case, our partners at Trade Ideas were the first to alert us to the dive. Currently (12:57), AMD is trading at $17.33 per share after a loss of $1.50 per share or 7.97% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the iWatch Markets team will continue to keep a close eye on AMD. In particular, we’re interested in seeing just how much the decline in Apple’s expectations equates to lowered revenue for Advanced Micro Devices. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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