Tallahassee,FL 10/28/11 (PennyPayDay) -- Shares of Advanced Micro Devices Inc. (NYSE: AMD) jumped in premarket trading Friday after the chip maker's strong quarterly results, and an analyst said it had the opportunity to gain share in the notebook market.It posted 3Q earnings and revenue growth that beat analyst expectations thanks to increasing demand in China, India and other emerging markets, and demand for its laptop chips. The notebook numbers were the real surprise for the quarter, said Citi Investment Research analyst Glen Yeung in a note to investors. AMD's notebook revenue grew 35 percent growth compared to the second quarter despite recent manufacturing problems, which had led it to cut its outlook last month. Yeung said he was worried that AMD's "mis-execution would cause irreparable damage" to its opportunities in the notebook computer market.
"But AMD made the right strategic decision to aggressively divert resources to (notebooks) and thereby keep the window of opportunity to gain share open," Yeung said. He kept a "Buy" rating on AMD's stock and raised his target price to $8 from $7.
The company said Thursday that it expected fourth-quarter revenue to increase 1 to 5 percent, a range that straddles the average analyst estimate. Shares rose 57 cents, or 10.7 percent, to $5.90 in premarket trading Friday. The stock closed at $5.33 on Thursday before the earnings report. Shares have dropped 35 percent this year.
AMD is the No. 2 maker of microprocessors, the "brains" of computers; making about a fifth of the world's supply.
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