ATI says it will miss its revenue estimates by up to $140 million as a result of lower than expected sales of Intel chipsets.
ATI Technologies expected revenues for the fourth quarter of fiscal 2006 to be between $620 million and $660 million. However, the company on Wednesday announced that consolidated revenue for the fourth quarter of fiscal 2006 is currently expected to be approximately $520 million.
The anticipated revenue shortfall is due primarily to lower sales volumes of integrated chipsets for Intel-based platforms, the company explained. In addition, handheld revenue was lower than expected, reflecting a supply chain adjustment by one of ATI’s major customers. “We believe this adjustment is temporary in nature and should not have a long-term impact on revenue,” the company said in a statement. Handheld and DTV businesses account for about 20% of ATI's revenue, which chipsets bring ATI roughly 26% of revenue, according to the company's Q3 FY2006 results.