The struggles for AMD continue, as Silicon Valley continues to receive punishment from a struggling economy

The sluggish global economy hit a number of markets before the tech industry, but now it's Silicon Valley's turn to go through financial turbulence.  Struggling CPU maker AMD has slashed its fourth-quarter revenue estimates 25 percent, claiming the current economic crisis continues to hurt the company more than expected.

Analysts indicate this latest AMD revenue forecast cut is due to the economy, and not so much because of Intel's superiority.  The company's third-quarter revenue of $1.59 billion, though its fourth-quarter revenue is expected to be flat compared to the previous quarter.  The 25 percent slide would be about $1.19 billion in the fourth quarter.  

"Not a surprise," Endpoint Technologies Associates analyst Roger Kay said in an interview.  "Times are tough.  Consumers are on the run, and AMD is proportionally more reliant on consumers than Intel.  It's not good for Intel.  How could it be good for AMD?"

In October, AMD received a multibillion-dollar cash deal with investors from Abu Dhabi, but just about everything else regarding the company has been somber.  AMD is now deep in debt and has suffered nine straight quarters of losses, while cutting more than 2,000 jobs since the spring.

AMD and Intel are the two largest microprocessor makers for PCs, and as the PC industry as a whole continues to get hammered, financial forecasts for both companies are expected to slide.

Sun Microsystems, eBay and other Silicon Valley companies have also started to feel the pinch from slowing demand tied to the sluggish global economy.  Companies such as SAP and Dell issued third-quarter results but do not plan to issue year-end forecasts because of the struggling economy.

"If you look at the last five years, if you look at what major innovations have occurred in computing technology, every single one of them came from AMD. Not a single innovation came from Intel." -- AMD CEO Hector Ruiz in 2007

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