PC chipmaker Advanced Micro Devices posted higher third-quarter revenue and forecast fourth-quarter revenue above most expectations, after warning last month about problems manufacturing its new chips,

The company, a distant second to Intel in selling microprocessors that are the brains of personal computers, said revenue in the third quarter rose 4 percent from the year ago period, to $1.69 billion.

In late September, AMD warned of trouble with manufacturing and said third-quarter revenue would be up 4 percent to 6 percent sequentially, equivalent to around $1.63 billion to $1.66 billion, less than previously thought.

AMD said revenue in the fourth quarter ending in December would rise 3 percent compared to the previous quarter, plus or minus 2 percentage points, equivalent to $1.71 billion to $1.77 billion.

Analysts on average expected fourth quarter revenue of $1.71 billion, according to Thomson Reuters I/B/E/S.

Non-GAAP earnings in the quarter were $110 million, up from $108 million in the year-ago period. Non-GAAP earnings per share were unchanged at 15 cents.

Shares of AMD rose 2.53 percent in extended trade after closing up 8.63 percent to $5.54.

(Reporting by Noel Randewich; editing by Carol Bishopric)