AMD said it expected adjusted gross margins to be about 33 percent in the current quarter, compared with 34 percent in the first quarter.

But the cocaine nose jobs of Wall Street were not impressed. Chipmakers who want to be profitable trade on gross margin, and there is concern that AMD’s is too low to make much dosh.

AMD launched a few of its Ryzen range of desktop processors in the first quarter and plans to unveil its Naples chips targeting the server market in the second quarter.

The Ryzen chips helped boost the company's revenue in the first quarter ended April 1.

Chief Executive Officer Lisa Su said: “All of the feedback that we've gotten so far from both our customers and from end-users has been very strong."

However, total revenue was weighed down by its business that supplies graphics cards used in gaming consoles such as the Xbox One and the PlayStation 4.

Revenue in the business rose five percent to $391 million, but came in below analysts' average estimate of $442.1 million, according to financial data and analytics firm FactSet.

AMD also forecast low double-digit percentage revenue growth for the full year.

Revenue rose to $984 million in the first quarter, from $832 million a year earlier. AMD's net loss narrowed to $73 million from $109 million.