Surprisingly, both AMD and Intel now raise their financial guidance for the fourth quarter this year. As I remember, mainboard makers reported demand slowdown in late November (see this news-story), so, it is a bit surprising that the largest manufacturers of CPUs raise their expectations towards the fourth quarter revenues. On the other hand, AMD fell in the third quarter so low, that there was no room to fall further, hence, they had to work better.

AMD is currently projecting fourth quarter sales to approach $700 million, an increase of approximately 35% over third quarter 2002 sales of $508 million. AMD had previously stated an expected sales increase of 20% or more in the fourth quarter of 2002 compared to the third quarter ended September 29, 2002.

The company said its Flash memory product sales, particularly in the high-end mobile phone market, continued to be strong. AMD also forecasted better than expected sales across its PC processor line, the result of a more competitive and richer product mix and increased seasonal demand for personal computers. AMD will report its fourth quarter 2002 results on January 16, 2003.

Intel expects revenue for the fourth quarter to be between $6.8 billion and $7.0 billion, as compared to the previous range of $6.5 billion to $6.9 billion. The company's Intel Architecture business is performing above expectations, primarily due to higher sales in Asia. Intel's communications businesses are in line with the company's expectations at the beginning of the quarter.

The gross margin percentage is expected to be at the high end of the previous range of 49%, plus or minus a couple of points. Gains or losses from equity investments and interest and other are expected to be a net loss of $90 million, as compared to the previous expectation of a net loss of $50 million, primarily due to higher impairment charges on equity investments. All other expectations are unchanged. The fourth quarter results will be issued after 28th of December.

So, the demand and prices on flash memory went up and AMD seems to benefit from it. The fact that is not less important is that they saw better results on the microprocessor market. Meanwhile, Intel manages to sell its products on the rapidly-growing Asian PC market what also should convince investors in the company’s confidence.