The California-based company had projected a slight increase in sales for the third quarter from its second-quarter sales of $1,26bn.

Instead, third-quarter sales will be slightly lower on softer demand for its flash memory products, says Robert Rivet, AMD's chief financial officer.

Microprocessor sales were up significantly for the quarter, which will help boost net income and gross margins, Rivet adds.

AMD will be profitable for the fourth straight quarter after breaking a string of nine unprofitable quarters in January, the company says.

The second half of the year usually produces the strongest quarters for PC and chip companies, but Intel said in September that it actually expects to report weaker demand for its products in the third quarter. Intel reports its earnings results next Tuesday.