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AMD Q3'23 Earnings Slides
AMD Q3'23 Earnings Slides
FINANCIAL
RESULTS October 31, 2023
CAUTIONARY STATEMENT
This presentation contains forward-looking statements concerning Advanced Micro Devices, Inc. (AMD), such as the features, functionality, performance, availability, timing and expected benefits of AMD products;
AMD’s expected fourth quarter 2023 financial outlook, including revenue, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP tax rate and diluted share count; AMD’s large and compelling TAM; AMD’s
ability to expand Data Center and AI leadership; and AMD’s ability to drive long-term shareholder returns, which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are commonly identified by words such as "would," "may," "expects," "believes," "plans," "intends," "projects" and other terms with similar meaning. Investors are cautioned that the forward-
looking statements in this presentation are based on current beliefs, assumptions and expectations, speak only as of the date of this presentation and involve risks and uncertainties that could cause actual results to
differ materially from current expectations. Such statements are subject to certain known and unknown risks and uncertainties, many of which are difficult to predict and generally beyond AMD's control, that could cause
actual results and other future events to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. Material factors that could cause actual results to differ
materially from current expectations include, without limitation, the following: Intel Corporation’s dominance of the microprocessor market and its aggressive business practices; global economic uncertainty; cyclical
nature of the semiconductor industry; market conditions of the industries in which AMD products are sold; loss of a significant customer; impact of the COVID-19 pandemic on AMD’s business, financial condition and
results of operations; competitive markets in which AMD’s products are sold; quarterly and seasonal sales patterns; AMD's ability to adequately protect its technology or other intellectual property; unfavorable currency
exchange rate fluctuations; ability of third party manufacturers to manufacture AMD's products on a timely basis in sufficient quantities and using competitive technologies; availability of essential equipment, materials,
substrates or manufacturing processes; ability to achieve expected manufacturing yields for AMD’s products; AMD's ability to introduce products on a timely basis with expected features and performance levels; AMD's
ability to generate revenue from its semi-custom SoC products; potential security vulnerabilities; potential security incidents including IT outages, data loss, data breaches and cyber-attacks; potential difficulties in
upgrading and operating AMD’s new enterprise resource planning system; uncertainties involving the ordering and shipment of AMD’s products; AMD’s reliance on third-party intellectual property to design and introduce
new products in a timely manner; AMD's reliance on third-party companies for design, manufacture and supply of motherboards, software and other computer platform components; AMD's reliance on Microsoft and
other software vendors' support to design and develop software to run on AMD’s products; AMD’s reliance on third-party distributors and add-in-board partners; impact of modification or interruption of AMD’s internal
business processes and information systems; compatibility of AMD’s products with some or all industry-standard software and hardware; costs related to defective products; efficiency of AMD's supply chain; AMD's
ability to rely on third party supply-chain logistics functions; AMD’s ability to effectively control sales of its products on the gray market; impact of government actions and regulations such as export administration
regulations, tariffs and trade protection measures; AMD’s ability to realize its deferred tax assets; potential tax liabilities; current and future claims and litigation; impact of environmental laws, conflict minerals-related
provisions and other laws or regulations; impact of acquisitions, joint ventures and/or investments on AMD’s business and AMD’s ability to integrate acquired businesses; impact of any impairment of AMD’s tangible,
definite-lived or indefinite-lived intangible assets, including goodwill, on AMD’s financial position and results of operation; restrictions imposed by agreements governing AMD’s notes, the guarantees of Xilinx’s notes and
the revolving credit facility; AMD's indebtedness; AMD's ability to generate sufficient cash to meet its working capital requirements or generate sufficient revenue and operating cash flow to make all of its planned R&D
or strategic investments, as well as the impact of financial institution failure on AMD’s cash and cash equivalents; political, legal, economic risks and natural disasters; future impairments of technology license
purchases; AMD’s ability to attract and retain qualified personnel; AMD’s stock price volatility. Investors are urged to review in detail the risks and uncertainties in AMD’s Securities and Exchange Commission filings,
including but not limited to AMD’s most recent reports on Forms 10-K and 10-Q.
Data Center HPC Leadership First x86 CPU with Adaptive SoC + AI AI Inference
and AI Solutions Server Solutions Integrated AI accelerator for Embedded Optimized Solutions
Q3 2022 Q3 2023
GAAP Non-GAAP1
GAAP Non-GAAP1
$1.3B $1.3B
$0.2B
$(0.1)B
▪ GAAP operating income driven by lower amortization of ▪ Non-GAAP operating income flat y/y due to stronger
acquisition-related intangible assets, stronger Client Client segment revenue and product mix, offset by
segment revenue and product mix, partially offset by increased R&D investments in AI
increased R&D investments in AI
1. See Appendices for GAAP to Non-GAAP reconciliation
$0.18
$0.04
▪ GAAP EPS of $0.18, up 350% y/y, primarily driven ▪ Non-GAAP EPS of $0.70, up 4% y/y, primarily driven
by lower amortization of acquisition-related by stronger Client segment revenue
intangible assets and stronger Client segment
revenue
1. Earnings Per Share (EPS) = Diluted earnings per share; see Appendices for GAAP to Non-GAAP reconciliation
1. See Appendices for GAAP to Non-GAAP reconciliation; Earnings Per Share (EPS) = Diluted earnings per share
12 Q3 2023 FINANCIAL RESULTS – OCTOBER 31, 2023
REVENUE
($ in Billions)
$5.6 $5.8
$5.6 $5.4
$5.4
46% 47%
43% 44%
42%
15 Q3 2023 FINANCIAL RESULTS – OCTOBER 31, 2023 1. See Appendices for GAAP to Non-GAAP reconciliation.
1
EARNINGS (LOSS) PER SHARE
(GAAP)
$0.18
$0.04
$0.01 $0.02
$(0.09)
Q3'22 Q4'22 Q1'23 Q2'23 Q3'23
1. Earnings Per Share (EPS) = Diluted earnings per share except for Q1’23 for which basic shares were used
16 Q3 2023 FINANCIAL RESULTS – OCTOBER 31, 2023
EARNINGS PER SHARE
(Non-GAAP)1
$0.69 $0.70
$0.67
$0.60
$0.58
1. See Appendices for GAAP to Non-GAAP reconciliation; Earnings Per Share (EPS) = Diluted earnings per share
17 Q3 2023 FINANCIAL RESULTS – OCTOBER 31, 2023
Q3 2023 SUMMARY BALANCE SHEET ITEMS
$1.6B $1.6B
31%
Strategic Highlights
▪ Almost 100 new AMD processor-powered cloud
19% instances launched from Amazon, Google,
Microsoft, Oracle, Tencent and others
▪ Enterprise wins in automotive, aerospace,
financial services, pharmaceutical and technology
Q3 2022 Q3 2023 Q3 2022 Q3 2023 ▪ Launched 4th Gen EPYC “Siena” processors for
intelligent edge and telco applications
Revenue Operating Income ▪ Announced acquisitions of Mipsology and Nod.ai
$1.6 Billion $306 Million to support expanding AI software capabilities
Growth in 4th Gen EPYCTM CPU sales Primarily due to increased R&D
offset by decrease in adaptive investments to support future AI revenue
System-on-Chip (SoC) product sales growth and product mix
$1.5B
Strategic Highlights
$1.0B
▪ Growth driven by strong demand for
RyzenTM 7000 series desktop and notebook
10% processors
(3)% ▪ More than 50 notebook designs powered by
Ryzen AI in market
Q3 2022 Q3 2023 ▪ Launched first ThreadripperTM PRO
Q3 2022 Q3 2023 workstation CPUs based on “Zen 4” core
Revenue Operating Income with Dell, HP and Lenovo announcing
workstations powered by new Threadripper
$1.5 Billion $140 Million PRO processors
Up 42% y/y vs. $26 Million Loss
a year ago
Primarily driven by higher
Ryzen mobile processor sales Primarily driven by higher revenue
and lower operating expenses
$1.6B
14%
$1.5B
Strategic Highlights
9% ▪ Launched new RadeonTM RX 7000
enthusiast desktop GPUs offering
leadership price/performance for 1440P
gamers
▪ Launched first AMD RDNA 3 architecture-
Q3 2022 Q3 2023 Q3 2022 Q3 2023 based mobile GPU enabling desktop-level
performance in Alienware’s newest m18
Revenue Operating Income gaming laptop
$1.5 Billion $208 Million
Down 8% y/y vs. $142 Million a year ago
$1.3B
$1.2B 49% 49% Strategic Highlights
▪ Launched first AMD adaptive SoCs with on-
chip HBM memory delivering significant
performance and efficiency for data center,
network, test and aerospace applications
Q3 2022 Q3 2023 Q3 2022 Q3 2023 ▪ Announced next-generation space-grade
Versal SoC integrating an enhanced AI
Engine
Revenue Operating Income ▪ Launched Alveo accelerator card for fintech
$1.2 Billion $612 Million market delivering 7x improvement in latency
compared to prior generation*
Down 5% y/y vs. $635 Million a year ago
($ in millions) Q4’23
1. 1. See Cautionary Statement on Slide 2. These forward-looking outlook statements and non-GAAP measures are based on current expectations as of October 31, 2023, and assumptions and beliefs
that involve numerous risks and uncertainties. AMD undertakes no intent or obligation to publicly update or revise its outlook statements as a result of new information, future events or otherwise, except
as may be required by law. All items, except revenue, are on a non-GAAP basis. Adjustments to arrive at the GAAP financial outlook typically include stock-based compensation, amortization of acquired
intangible assets, income tax provision, and other non-recurring items such as impairment charges and acquisition-related costs. The timing and impact of such adjustments are dependent on future
events that are typically uncertain or outside of AMD's control, therefore, a reconciliation to equivalent GAAP measures is not practicable at this time.
2. 2. Refer to Diluted Share Count overview in the Appendices
27
27 Q3 2023 FINANCIAL RESULTS – OCTOBER 31, 2023
APPENDICES
RECONCILIATION OF GAAP TO NON-GAAP GROSS PROFIT AND GROSS MARGIN
(Millions) (Unaudited) Q3’22 Q4’22 Q1’23 Q2’23 Q3’23
GAAP gross profit $ 2,354 $ 2,403 $ 2,359 $ 2,443 $ 2,747
GAAP gross margin 42% 43% 44% 46% 47%
Stock-based compensation 8 9 8 10 6
Amortization of acquisition-related intangibles 412 443 305 212 210
Acquisition-related and other costs (1) 2 4 3 - -
Non-GAAP gross profit $ 2,776 $ 2,859 $ 2,675 $ 2,665 $ 2,963
Non-GAAP gross margin 50% 51% 50% 50% 51%
(1) Acquisition-related and other costs primarily comprised of transaction costs, purchase price adjustments for inventory, certain compensation charges, contract termination and
workforce rebalancing charges.
28 Q3 2023 FINANCIAL RESULTS – OCTOBER 31, 2023
APPENDICES
RECONCILIATION OF GAAP OPERATING INCOME (LOSS) TO NON-GAAP OPERATING INCOME
(1) Acquisition-related and other costs primarily comprised of transaction costs, purchase price adjustments for inventory, certain compensation charges, contract termination and
workforce rebalancing charges.
Shares used in per share calculation (GAAP) (2) 1,625 1,618 1,611 1,627 1,629
Shares used in per share calculation (Non-GAAP) (2) 1,625 1,618 1,618 1,627 1,629
(1) Acquisition-related and other costs primarily comprised of transaction costs, purchase price adjustments for inventory, certain compensation charges, contract termination and
workforce rebalancing charges.
(2) GAAP and non-GAAP diluted EPS include the assumed conversion of the Company's 2026 Convertible Notes under the "if converted" method.
(3) Earnings Per Share (EPS) = Diluted earnings per share except for Q1’23 for which basic shares were used.
The table above provides actual share count for Q3’23 and an estimate of share count to use when calculating GAAP and non-GAAP diluted earnings per share for Q4’23.
(1) Share counts are weighted average shares.
(2) The dilutive impact of employee equity grants is based on the Treasury Stock method and is dependent upon the average stock price during the period. The Q3’23 average stock price was
$108.55. The Q3’23 average stock price of $108.55 was assumed for Q4’23 average stock price estimates.