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Advanced Micro Devices Inc. said revenue fell 23% in the fourth quarter, amid lower sales of processors used in personal computers and a decline in game console royalties, though the chip maker's quarterly loss narrowed.

Meanwhile, the price of the company's shares fell 6.2% to $1.83 in recent after-hours trading, as AMD's sales forecast for the current quarter was mostly below analysts' expectations.

For the quarter ending in March, the company forecast a revenue decline of 14%, "plus or minus 3%," from the December quarter. Analysts polled by Thomson Reuters had expected revenue to fall 13% to $899 million.

For the three-month period ended Dec. 26, AMD reported revenue of $958 million, down from $1.24 billion a year earlier. Analysts had expected revenue of $955 million.

In the computing and graphics segment, which includes chips for personal computers, revenue fell 29% to $470 million. Average selling prices declined, mostly owing to weaker prices for processors used in notebook computers.

AMD's business that includes technology for game consoles—along with server and embedded processors and semi-custom products—reported revenue decreased 15% to $488 million, mostly driven by lower game console royalties and weaker revenue for server and embedded processors.

Overall, AMD posted a loss of $102 million, or 13 cents a share, compared with a year-earlier loss of $364 million, or 47 cents a share. Excluding stock-based compensation and other items, the per-share loss was 10 cents, compared with adjusted earnings of two cents a year earlier.

Gross margin widened to 30% from 29%, as lower costs offset the decline in sales. Overhead costs fell 3.5%, while research-and-development expenses dropped 24%.

AMD, based in Sunnyvale, Calif., is for a long time trailed market leader Intel Corp. in selling microprocessors for PCs. Like other chip makers, AMD has been hurt by weaker demand for personal computers. Though AMD has taken steps to diversify its business, but other markets including chips for videogame consoles from Sony Corp. and Microsoft Corp. have weakened.

AMD also has continued efforts to cut costs, including a joint venture unveiled in October with a Chinese company that will provide a $371 million cash infusion and is expected to reduce AMD's spending in the future.

AMD several years ago sold off the operations that manufacture its chips. But it retained facilities in China and Malaysia that package and test products it designs. Under the joint venture pact, Nantong Fujitsu Microelectronics will acquire an 85% stake in those operations and AMD will retain the remainder.

Write to Tess Stynes at tess.stynes@wsj.com

(END) Dow Jones Newswires

January 19, 2016 17:55 ET (22:55 GMT)

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