AMD (NASDAQ:AMD) today announced revenue for the fourth quarter of
2022 of $5.6 billion, gross margin of 43%, operating loss of $149
million, net income of $21 million and diluted earnings per share
of $0.01. On a non-GAAP(*) basis, gross margin was 51%, operating
income was $1.3 billion, net income was $1.1 billion and diluted
earnings per share was $0.69.
For full year 2022, the company reported revenue of $23.6
billion, gross margin of 45%, operating income of $1.3 billion, net
income of $1.3 billion and diluted earnings per share of $0.84. On
a non-GAAP(*) basis, gross margin was 52%, operating income was
$6.3 billion, net income was $5.5 billion and diluted earnings per
share was $3.50.
GAAP Quarterly Financial
Results
|
Q4 2022 |
Q4 2021 |
Y/Y |
Revenue ($M) |
$5,599 |
$4,826 |
Up 16% |
Gross profit ($M) |
$2,403 |
$2,426 |
Flat |
Gross margin % |
43% |
50% |
Down 740 bps |
Operating expenses ($M) |
$2,557 |
$1,223 |
Up 109% |
Operating income (loss) ($M) |
$(149) |
$1,207 |
Down 112% |
Operating margin % |
(3)% |
25% |
Down 28pp |
Net income ($M) |
$21 |
$974 |
Down 98% |
Earnings per share |
$0.01 |
$0.80 |
Down 99% |
Non-GAAP(*)
Quarterly Financial Results
|
Q4 2022 |
Q4 2021 |
Y/Y |
Revenue ($M) |
$5,599 |
$4,826 |
Up 16% |
Gross profit ($M) |
$2,859 |
$2,427 |
Up 18% |
Gross margin % |
51% |
50% |
Up 70 bps |
Operating expenses ($M) |
$1,602 |
$1,103 |
Up 45% |
Operating income ($M) |
$1,262 |
$1,328 |
Down 5% |
Operating margin % |
23% |
27% |
Down 4pp |
Net income ($M) |
$1,113 |
$1,122 |
Flat |
Earnings per share |
$0.69 |
$0.92 |
Down 25% |
Annual Financial Results
|
GAAP |
Non-GAAP(*) |
|
2022 |
2021 |
Y/Y |
2022 |
2021 |
Y/Y |
Revenue ($M) |
$23,601 |
$16,434 |
Up 44% |
$23,601 |
$16,434 |
Up 44% |
Gross profit ($M) |
$10,603 |
$7,929 |
Up 34% |
$12,273 |
$7,934 |
Up 55% |
Gross margin % |
45% |
48% |
Down 330bps |
52% |
48% |
Up 370bps |
Operating expenses ($M) |
$9,441 |
$4,293 |
Up 120% |
$6,030 |
$3,877 |
Up 56% |
Operating income ($M) |
$1,264 |
$3,648 |
Down 65% |
$6,345 |
$4,069 |
Up 56% |
Operating margin % |
5% |
22% |
Down 17pp |
27% |
25% |
Up 2pp |
Net income ($M) |
$1,320 |
$3,162 |
Down 58% |
$5,504 |
$3,435 |
Up 60% |
Earnings per share |
$0.84 |
$2.57 |
Down 67% |
$3.50 |
$2.79 |
Up 25% |
“2022 was a strong year for AMD as we delivered best-in-class
growth and record revenue despite the weak PC environment in the
second half of the year," said AMD Chair and CEO Dr. Lisa Su. "We
accelerated our data center momentum and closed our strategic
acquisition of Xilinx, significantly diversifying our business and
strengthening our financial model. Although the demand environment
is mixed, we are confident in our ability to gain market share in
2023 and deliver long-term growth based on our differentiated
product portfolio.”
Q4 2022 Results
- Revenue of $5.6 billion increased 16% year-over-year primarily
driven by growth across the Embedded and Data Center segments,
partially offset by lower Client and Gaming segment revenue.
- Gross margin was 43%, a decrease of 7 percentage points
year-over-year, primarily due to amortization of intangible assets
associated with the Xilinx acquisition. Non-GAAP gross margin was
51%, an increase of 1 percentage point year-over-year, primarily
driven by a richer product mix with higher Embedded and Data Center
segment revenue, partially offset by lower Client segment
revenue.
- Operating loss was $149 million, compared to operating income
of $1.2 billion, or 25% of revenue a year ago. The loss was
primarily due to the amortization of intangible assets associated
with the Xilinx acquisition. Non-GAAP operating income was $1.3
billion, or 23% of revenue, compared to $1.3 billion or 27% a year
ago. The non-GAAP operating margin decline was primarily due to
lower Client segment operating income.
- Net income was $21 million compared to net income of $974
million a year ago primarily due to the amortization of intangible
assets associated with the Xilinx acquisition, partially offset by
a $154 million tax benefit in the quarter. Non-GAAP net income was
$1.1 billion, flat from a year ago.
- Diluted earnings per share was $0.01 compared to $0.80 a year
ago primarily due to the amortization of intangible assets
associated with the Xilinx acquisition, partially offset by a $154
million tax benefit in the quarter. Non-GAAP diluted earnings per
share was $0.69 compared to $0.92 a year ago primarily due to lower
Client segment operating income.
- Cash, cash equivalents and short-term investments were $5.9
billion at the end of the quarter. The company returned $250
million to shareholders through share repurchases in the
quarter.
- Cash from operations was $567 million in the quarter, compared
to $822 million a year ago. Free cash flow was $443 million in the
quarter compared to $736 million a year ago.
- Goodwill and acquisition-related intangible assets associated
with the acquisitions of Xilinx and Pensando were $48.3 billion at
the end of the quarter.
Quarterly Financial Segment Summary
- Prior period results have been conformed to the current
reporting segments for comparison purposes.
- Data Center segment revenue was $1.7 billion, up 42%
year-over-year primarily driven by strong sales of EPYC™ server
processors. Operating income was $444 million, or 27% of revenue,
compared to $369 million or 32% a year ago. The operating income
increase was primarily driven by higher revenue, partially offset
by higher R&D investments to support growth. The operating
margin decrease was primarily due to higher R&D investments to
support growth.
- Client segment revenue was $903 million, down 51%
year-over-year due to reduced processor shipments resulting from a
weak PC market and a significant inventory correction across the PC
supply chain. Client processor ASP was flat year-over-year.
Operating loss was $152 million, compared to operating income of
$530 million or 29% of revenue a year ago primarily due to lower
revenue.
- Gaming segment revenue was $1.6 billion, down 7% year-over-year
driven by lower gaming graphics sales partially offset by higher
semi-custom product revenue. Operating income was $266 million, or
16% of revenue, compared to $407 million or 23% a year ago. The
operating income and margin decreases were primarily due to lower
graphics revenue.
- Embedded segment revenue was $1.4 billion, up 1,868%
year-over-year primarily driven by the inclusion of Xilinx embedded
revenue. Operating income was $699 million, or 50% of revenue,
compared to $18 million or 25% a year ago. The operating income and
margin increases were primarily driven by higher revenue.
- All Other operating loss was $1.4 billion as compared to $117
million a year ago primarily due to amortization of intangible
assets largely associated with the Xilinx acquisition.
2022 Annual Results
- Revenue of $23.6 billion was up 44% over 2021 driven by higher
Embedded, Data Center, and Gaming segment revenue, partially offset
by lower Client segment revenue. On a combined AMD and Xilinx
company basis, 2022 pro forma revenue was $24.1 billion, up 20%
compared to $20.1 billion in 2021.
- Gross margin was 45%, a decrease of 3 percentage points over
2021 primarily due to amortization of intangible assets associated
with the Xilinx acquisition. Non-GAAP gross margin was 52%, an
increase of 4 percentage points compared to a year ago, primarily
driven by a richer product mix with higher Embedded and Data Center
segment revenue, partially offset by lower Client segment
revenue.
- Operating income was $1.3 billion compared to $3.6 billion in
the prior year. The decrease was primarily due to the amortization
of intangible assets associated with the Xilinx acquisition.
Non-GAAP operating income was $6.3 billion compared to $4.1 billion
in the prior year primarily driven by higher revenue and gross
margin expansion.
- Net income was $1.3 billion compared to $3.2 billion in the
prior year. Non-GAAP net income was $5.5 billion compared to $3.4
billion in the prior year.
- Diluted earnings per share was $0.84 compared to $2.57 in the
prior year. Non-GAAP diluted earnings per share was $3.50 compared
to $2.79 in the prior year.
- Cash, cash equivalents and short-term investments were $5.9
billion at the end of the year. The company returned a total of
$3.7 billion to shareholders through share repurchases in
2022.
- Cash from operations was $3.6 billion, compared to $3.5 billion
in the prior year. Free cash flow was $3.1 billion compared to $3.2
billion in the prior year.
Recent PR Highlights
- AMD showcased continued growth and momentum in the data center
with AMD EPYC processors powering the modern data center and
critical cloud workloads.
- AMD announced the availability of 4th Gen AMD EPYC CPUs,
delivering leadership performance and energy efficiency. The latest
AMD EPYC processors, built on the “Zen 4” core, deliver
next-generation architecture, technology and features to power the
modern data center. Cloud service providers including Google Cloud,
Microsoft and Oracle Cloud Infrastructure announced planned
solutions leveraging the performance and security features of 4th
Gen AMD EPYC CPUs.
- AMD powers 101 supercomputers in the latest Top500 list of the
most powerful supercomputers in the world and 75% of the top 20
systems on the Green500 list of the world’s most energy efficient
supercomputers.
- AMD delivered the opening keynote at CES 2023 alongside
partners Microsoft, HP, Lenovo, Magic Leap and Intuitive Surgical
highlighting next-generation AMD technologies advancing AI, hybrid
work, gaming, healthcare, aerospace and sustainable computing.
During the keynote, AMD announced:
- The broadest portfolio of high-performance PC products for
mobile and desktop applications, including Ryzen™ 7000X3D Series
Desktop processors that bring the power of AMD 3D V-Cache™
technology to gamers and creators and Ryzen 7000 Series Mobile
processors that deliver unparalleled performance for demanding
workloads with up to 16 powerful “Zen 4” cores and bring new Ryzen
AI technology to select laptop devices.
- AMD Radeon™ RX 7000 Series Graphics for laptop PCs, built on
AMD RDNA™ 3 architecture and designed to deliver exceptional energy
efficiency and performance to power 1080p gaming at ultra-settings
and advanced content creation applications on next-generation
premium laptops.
- The AMD Alveo™ V70 AI Accelerator with industry-leading
performance and energy efficiency for multiple AI inference
workloads.
- A preview of the world’s first integrated data center CPU and
GPU, the AMD Instinct™ MI300. Designed for leadership HPC and AI
performance, MI300 accelerators leverage chiplet design combining
AMD CDNA™ 3 GPU architecture, “Zen 4” CPU cores, and HBM.
- AMD Vitis™ Medical Imaging libraries to bring premium medical
imaging products to market faster by reducing development times.
These software libraries accelerate premium medical imaging on AMD
Versal™ SoC devices with AI Engines to deliver healthcare providers
and their patients high-quality, low-latency imaging.
- AMD continued to showcase its embedded market leadership.
- AMD announced its collaboration with the Energy Sciences
Network on the launch of ESnet6, the newest generation of the U.S.
Department of Energy’s high-performance network dedicated to
science.
- AMD announced it completed Class B qualification for the
company’s first space-grade Versal adaptive SoCs.
- AMD shared that the AMD Xilinx Automotive (XA) Zynq™
UltraScale+™ MPSoC platform has been selected to power the Aisin
Automated Parking-Assist (APA) system.
- AMD unveiled the new Alveo X3 series network cards, the first
AMD network cards designed with screened FPGAs and optimized
specifically for low latency trading.
- AMD and Viettel High Tech announced a collaboration on a 5G
mobile network expansion.
- AMD announced that its adaptive computing technology is
powering leading mobility supplier DENSO Corporation’s
next-generation LiDAR platform.
- AMD announced the Radeon RX 7900 series graphics cards, the
world’s first gaming graphics cards to feature an advanced AMD
chiplet design, delivering exceptional performance and energy
efficiency to power high-framerate 4K and higher resolution gaming
in the most demanding titles.
- AMD announced changes to its senior leadership team, including
the retirement of executive vice president, chief financial officer
and treasurer Devinder Kumar after 39 years with the company. The
company appointed Jean Hu as AMD executive vice president, chief
financial officer and treasurer, effective January 23, 2023 and
announced the promotion of Forrest Norrod to executive vice
president and general manager of the Data Center Solutions business
group.
Current OutlookAMD’s outlook statements are
based on current expectations. The following statements are
forward-looking and actual results could differ materially
depending on market conditions and the factors set forth under
“Cautionary Statement” below.
For the first quarter of 2023, AMD expects revenue to be
approximately $5.3 billion, plus or minus $300 million, a decrease
of approximately 10% year-over-year. Year-over-year the Client and
Gaming segments are expected to decline, partially offset by
Embedded and Data Center segment growth. AMD expects non-GAAP gross
margin to be approximately 50% in the first quarter of 2023.
AMD TeleconferenceAMD will hold a conference
call for the financial community at 2:00 p.m. PT (5:00 p.m. ET)
today to discuss its fourth quarter and full-year 2022 financial
results. AMD will provide a real-time audio broadcast of the
teleconference on the Investor Relations page of its website at
www.amd.com.
|
|
|
|
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL
MEASURES |
(in
millions, except per share data) (Unaudited) |
|
|
Three Months Ended |
|
Year Ended |
|
|
December 31,2022 |
|
December 25,2021 |
|
December 31,2022 |
|
December 25,2021 |
GAAP gross profit |
|
$ |
2,403 |
|
|
$ |
2,426 |
|
|
$ |
10,603 |
|
|
$ |
7,929 |
|
GAAP gross margin % |
|
|
43 |
% |
|
|
50 |
% |
|
|
45 |
% |
|
|
48 |
% |
Stock-based compensation |
|
|
9 |
|
|
|
1 |
|
|
|
29 |
|
|
|
5 |
|
Acquisition-related costs(1) |
|
|
4 |
|
|
|
— |
|
|
|
193 |
|
|
|
— |
|
Amortization of acquired intangible assets |
|
|
443 |
|
|
|
— |
|
|
|
1,448 |
|
|
|
— |
|
Non-GAAP gross
profit |
|
$ |
2,859 |
|
|
$ |
2,427 |
|
|
$ |
12,273 |
|
|
$ |
7,934 |
|
Non-GAAP gross margin % |
|
|
51 |
% |
|
|
50 |
% |
|
|
52 |
% |
|
|
48 |
% |
|
|
|
|
|
|
|
|
|
GAAP operating
expenses |
|
$ |
2,557 |
|
|
$ |
1,223 |
|
|
$ |
9,441 |
|
|
$ |
4,293 |
|
GAAP operating expenses/revenue % |
|
|
46 |
% |
|
|
25 |
% |
|
|
40 |
% |
|
|
26 |
% |
Stock-based compensation |
|
|
301 |
|
|
|
111 |
|
|
|
983 |
|
|
|
374 |
|
Acquisition-related costs(1) |
|
|
53 |
|
|
|
9 |
|
|
|
328 |
|
|
|
42 |
|
Amortization of acquired intangible assets |
|
|
601 |
|
|
|
— |
|
|
|
2,100 |
|
|
|
— |
|
Non-GAAP operating
expenses |
|
$ |
1,602 |
|
|
$ |
1,103 |
|
|
$ |
6,030 |
|
|
$ |
3,877 |
|
Non-GAAP operating expenses/revenue % |
|
|
29 |
% |
|
|
23 |
% |
|
|
26 |
% |
|
|
24 |
% |
|
|
|
|
|
|
|
|
|
GAAP operating income
(loss) |
|
$ |
(149 |
) |
|
$ |
1,207 |
|
|
$ |
1,264 |
|
|
$ |
3,648 |
|
GAAP operating margin % |
|
(3)% |
|
|
25 |
% |
|
|
5 |
% |
|
|
22 |
% |
Stock-based compensation |
|
|
310 |
|
|
|
112 |
|
|
|
1,012 |
|
|
|
379 |
|
Acquisition-related costs(1) |
|
|
57 |
|
|
|
9 |
|
|
|
521 |
|
|
|
42 |
|
Amortization of acquired intangible assets |
|
|
1,044 |
|
|
|
— |
|
|
|
3,548 |
|
|
|
— |
|
Non-GAAP operating
income |
|
$ |
1,262 |
|
|
$ |
1,328 |
|
|
$ |
6,345 |
|
|
$ |
4,069 |
|
Non-GAAP operating margin % |
|
|
23 |
% |
|
|
27 |
% |
|
|
27 |
% |
|
|
25 |
% |
|
|
Three Months Ended |
Year Ended |
|
|
December 31,2022 |
|
December 25,2021 |
|
December 31,2022 |
|
December 25,2021 |
GAAP net income / earnings per share |
|
$ |
21 |
|
|
$ |
0.01 |
|
|
$ |
974 |
|
|
$ |
0.80 |
|
|
$ |
1,320 |
|
|
$ |
0.84 |
|
|
$ |
3,162 |
|
|
$ |
2.57 |
|
Loss on debt redemption/conversion |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7 |
|
|
|
— |
|
(Gains) losses on equity investments, net |
|
|
5 |
|
|
|
— |
|
|
|
(4 |
) |
|
|
— |
|
|
|
62 |
|
|
|
0.04 |
|
|
|
(56 |
) |
|
|
(0.04 |
) |
Stock-based compensation |
|
|
310 |
|
|
|
0.19 |
|
|
|
112 |
|
|
|
0.09 |
|
|
|
1,012 |
|
|
|
0.64 |
|
|
|
379 |
|
|
|
0.31 |
|
Equity income in investee |
|
|
(3 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(14 |
) |
|
|
(0.01 |
) |
|
|
(6 |
) |
|
|
— |
|
Acquisition-related costs(1) |
|
|
57 |
|
|
|
0.04 |
|
|
|
9 |
|
|
|
— |
|
|
|
521 |
|
|
|
0.33 |
|
|
|
42 |
|
|
|
0.03 |
|
Amortization of acquired intangible assets |
|
|
1,044 |
|
|
|
0.65 |
|
|
|
— |
|
|
|
— |
|
|
|
3,548 |
|
|
|
2.26 |
|
|
|
— |
|
|
|
— |
|
Income tax provision |
|
|
(321 |
) |
|
|
(0.20 |
) |
|
|
31 |
|
|
|
0.03 |
|
|
|
(945 |
) |
|
|
(0.60 |
) |
|
|
(93 |
) |
|
|
(0.08 |
) |
Non-GAAP net income /
earnings per share |
|
$ |
1,113 |
|
|
$ |
0.69 |
|
|
$ |
1,122 |
|
|
$ |
0.92 |
|
|
$ |
5,504 |
|
|
$ |
3.50 |
|
|
$ |
3,435 |
|
|
$ |
2.79 |
|
(1) |
|
Acquisition-related costs primarily comprised of transaction costs,
purchase price adjustments for inventory and certain compensation
charges |
|
|
|
|
RECONCILIATION OF AMD AS-REPORTED REVENUE TO PRO FORMA
REVENUE(in billions) (Unaudited) |
|
|
|
Year Ended |
|
December 31,2022 |
|
December 25,2021 |
AMD Net Revenue - As reported |
23.6 |
|
|
16.4 |
|
Pre-Acquisition
Revenue(1) |
0.5 |
|
|
3.7 |
|
AMD Net Revenue - Pro
forma(2) |
24.1 |
|
|
20.1 |
|
(1) |
|
Pre-acquisition revenue for the year ended December 31, 2022
includes unaudited Xilinx revenue from January 2, 2022 to February
13, 2022. Pre-acquisition revenue for the year ended December 25,
2021 includes unaudited Xilinx revenue for the twelve months ended
January 1, 2022. |
|
|
|
(2) |
|
The unaudited AMD net revenue prepared on a pro forma basis
represents the Company's consolidated revenue for the year ended
December 31, 2022 and December 25, 2021, as if the acquisitions had
been consummated as of the beginning of the fiscal year 2021 (i.e.,
December 27, 2020). The unaudited pro forma revenue is presented on
the basis of the Company’s fiscal year and combines the historical
results of the fiscal periods of the Company with the following
historical results of Xilinx: the year ended December 31, 2022
includes Xilinx revenue for the twelve-month period beginning
January 2, 2022 through December 31, 2022; and the year ended
December 25, 2021 includes Xilinx revenue for the twelve months
ended January 1, 2022. The unaudited pro forma financial revenue
presented is for informational purposes only and is not necessarily
indicative of the results of operations that would have been
achieved if the Xilinx acquisitions were completed at the beginning
of fiscal year 2021 and are not indicative of the future operating
results of the combined company. |
|
|
|
About AMDFor more than 50 years AMD has driven
innovation in high-performance computing, graphics and
visualization technologies. AMD employees are focused on building
leadership high-performance and adaptive products that push the
boundaries of what is possible. Billions of people, leading Fortune
500 businesses and cutting-edge scientific research institutions
around the world rely on AMD technology daily to improve how they
live, work and play. For more information about how AMD is enabling
today and inspiring tomorrow, visit the AMD (NASDAQ: AMD) website,
blog, Facebook and Twitter pages.
Cautionary Statement This press release
contains forward-looking statements concerning Advanced Micro
Devices, Inc. (AMD) such as AMD’s ability to gain market share in
2023 and deliver long-term growth based on its differentiated
product portfolio; the features, functionality, performance,
availability, timing and expected benefits of AMD products; and
AMD’s expected first quarter of 2023 financial outlook, including
revenue and non-GAAP gross margin and expected drivers based on
current expectations, 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 press release
are based on current beliefs, assumptions and expectations, speak
only as of the date of this press release 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, including acquisitions of Xilinx and Pensando, on
AMD’s business and AMD’s ability to integrate acquired
businesses; impact of any impairment of the combined
company’s assets on the combined company’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; political, legal,
economic risks and natural disasters; future impairments of
goodwill and technology license purchases; AMD’s ability to attract
and retain qualified personnel; AMD’s stock price volatility; and
worldwide political conditions. 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.
(*) In this earnings press release, in addition to GAAP
financial results, AMD has provided non-GAAP financial measures
including non-GAAP gross profit, non-GAAP operating expenses,
non-GAAP operating income, non-GAAP net income, non-GAAP diluted
earnings per share. AMD uses a normalized tax rate in its
computation of the non-GAAP income tax provision to provide better
consistency across the reporting periods. For fiscal 2022, AMD uses
a non-GAAP tax rate of 13%, which excludes the tax impact of
pre-tax non-GAAP adjustments. AMD also provided adjusted EBITDA and
free cash flow as supplemental non-GAAP measures of its
performance. These items are defined in the footnotes to the
selected corporate data tables provided at the end of this earnings
press release. In addition, AMD provided pro forma revenue for the
year ended December 31, 2022 and December 25, 2021 which include
unaudited Xilinx pre-acquisition revenue from January 2, 2022 to
February 13, 2022 and for the twelve months ended January 1, 2022,
respectively, as supplemental information. AMD is providing these
financial measures because it believes this non-GAAP presentation
makes it easier for investors to compare its operating results for
current and historical periods and also because AMD believes it
assists investors in comparing AMD’s performance across reporting
periods on a consistent basis by excluding items that it does not
believe are indicative of its core operating performance and for
the other reasons described in the footnotes to the selected data
tables. The non-GAAP financial measures disclosed in this earnings
press release should be viewed in addition to and not as a
substitute for or superior to AMD’s reported results prepared in
accordance with GAAP and should be read only in conjunction with
AMD’s Consolidated Financial Statements prepared in accordance with
GAAP. These non-GAAP financial measures referenced are reconciled
to their most directly comparable GAAP financial measures in the
data tables in this earnings press release. This earnings press
release also contains forward-looking non-GAAP gross margin
concerning AMD’s financial outlook, which is based on current
expectations as of January 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.
AMD, the AMD Arrow logo, EPYC, Radeon, Ryzen,
Threadripper, Versal and combinations thereof, are trademarks of
Advanced Micro Devices, Inc. Other names are
for informational purposes only and used to identify companies and
products and may be trademarks of their respective
owner.
|
ADVANCED
MICRO DEVICES, INC.CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS(Millions except per share
amounts and percentages) (Unaudited) |
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
|
December 31,2022 |
|
December 25,2021 |
|
December 31,2022 |
|
December 25,2021 |
Net revenue |
|
$ |
5,599 |
|
|
$ |
4,826 |
|
|
$ |
23,601 |
|
|
$ |
16,434 |
|
Cost of sales |
|
|
2,753 |
|
|
|
2,400 |
|
|
|
11,550 |
|
|
|
8,505 |
|
Amortization of
acquisition-related intangibles |
|
|
443 |
|
|
|
— |
|
|
|
1,448 |
|
|
|
— |
|
Total cost of sales |
|
|
3,196 |
|
|
|
2,400 |
|
|
|
12,998 |
|
|
|
8,505 |
|
Gross profit |
|
|
2,403 |
|
|
|
2,426 |
|
|
|
10,603 |
|
|
|
7,929 |
|
Gross margin % |
|
|
43 |
% |
|
|
50 |
% |
|
|
45 |
% |
|
|
48 |
% |
Research and development |
|
|
1,366 |
|
|
|
811 |
|
|
|
5,005 |
|
|
|
2,845 |
|
Marketing, general and
administrative |
|
|
590 |
|
|
|
412 |
|
|
|
2,336 |
|
|
|
1,448 |
|
Amortization of
acquisition-related intangibles |
|
|
601 |
|
|
|
— |
|
|
|
2,100 |
|
|
|
— |
|
Licensing gain |
|
|
(5 |
) |
|
|
(4 |
) |
|
|
(102 |
) |
|
|
(12 |
) |
Operating income (loss) |
|
|
(149 |
) |
|
|
1,207 |
|
|
|
1,264 |
|
|
|
3,648 |
|
Interest expense |
|
|
(19 |
) |
|
|
(8 |
) |
|
|
(88 |
) |
|
|
(34 |
) |
Other income (expense),
net |
|
|
32 |
|
|
|
4 |
|
|
|
8 |
|
|
|
55 |
|
Income (loss) before income taxes and equity income |
|
|
(136 |
) |
|
|
1,203 |
|
|
|
1,184 |
|
|
|
3,669 |
|
Income tax provision
(benefit) |
|
|
(154 |
) |
|
|
229 |
|
|
|
(122 |
) |
|
|
513 |
|
Equity income in investee |
|
|
3 |
|
|
|
— |
|
|
|
14 |
|
|
|
6 |
|
Net income |
|
$ |
21 |
|
|
$ |
974 |
|
|
$ |
1,320 |
|
|
$ |
3,162 |
|
Earnings per share |
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.01 |
|
|
$ |
0.81 |
|
|
$ |
0.85 |
|
|
$ |
2.61 |
|
Diluted |
|
$ |
0.01 |
|
|
$ |
0.80 |
|
|
$ |
0.84 |
|
|
$ |
2.57 |
|
Shares used in per share
calculation |
|
|
|
|
|
|
|
|
Basic |
|
|
1,613 |
|
|
|
1,208 |
|
|
|
1,561 |
|
|
|
1,213 |
|
Diluted |
|
|
1,618 |
|
|
|
1,222 |
|
|
|
1,571 |
|
|
|
1,229 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADVANCED
MICRO DEVICES, INC.CONDENSED CONSOLIDATED BALANCE
SHEETS(Millions) |
|
|
|
|
|
|
|
December 31,2022 |
|
December 25,2021 |
|
|
(Unaudited) |
|
|
ASSETS |
|
|
|
|
Current
assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
4,835 |
|
|
$ |
2,535 |
|
Short-term investments |
|
|
1,020 |
|
|
|
1,073 |
|
Accounts receivable, net |
|
|
4,126 |
|
|
|
2,706 |
|
Inventories |
|
|
3,771 |
|
|
|
1,955 |
|
Receivables from related parties |
|
|
2 |
|
|
|
2 |
|
Prepaid expenses and other current assets |
|
|
1,265 |
|
|
|
312 |
|
Total current
assets |
|
|
15,019 |
|
|
|
8,583 |
|
Property and equipment,
net |
|
|
1,513 |
|
|
|
702 |
|
Operating lease right-of use
assets |
|
|
460 |
|
|
|
367 |
|
Goodwill |
|
|
24,177 |
|
|
|
289 |
|
Acquisition-related
intangibles, net |
|
|
24,118 |
|
|
|
— |
|
Investment: equity method |
|
|
83 |
|
|
|
69 |
|
Deferred tax assets |
|
|
58 |
|
|
|
931 |
|
Other non-current assets |
|
|
2,152 |
|
|
|
1,478 |
|
Total
Assets |
|
$ |
67,580 |
|
|
$ |
12,419 |
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
Current
liabilities: |
|
|
|
|
Accounts payable |
|
$ |
2,493 |
|
|
$ |
1,321 |
|
Payables to related parties |
|
|
463 |
|
|
|
85 |
|
Accrued liabilities |
|
|
3,077 |
|
|
|
2,424 |
|
Current portion of long-term debt, net |
|
|
— |
|
|
|
312 |
|
Other current liabilities |
|
|
336 |
|
|
|
98 |
|
Total current
liabilities |
|
|
6,369 |
|
|
|
4,240 |
|
Long-term debt, net of current
portion |
|
|
2,467 |
|
|
|
1 |
|
Long-term operating lease
liabilities |
|
|
396 |
|
|
|
348 |
|
Deferred tax liabilities |
|
|
1,934 |
|
|
|
12 |
|
Other long-term
liabilities |
|
|
1,664 |
|
|
|
321 |
|
|
|
|
|
|
Stockholders'
equity: |
|
|
|
|
Capital stock: |
|
|
|
|
Common stock, par value |
|
|
16 |
|
|
|
12 |
|
Additional paid-in capital |
|
|
58,005 |
|
|
|
11,069 |
|
Treasury stock, at cost |
|
|
(3,099 |
) |
|
|
(2,130 |
) |
Accumulated deficit |
|
|
(131 |
) |
|
|
(1,451 |
) |
Accumulated other
comprehensive loss |
|
|
(41 |
) |
|
|
(3 |
) |
Total stockholders'
equity |
|
$ |
54,750 |
|
|
$ |
7,497 |
|
Total Liabilities and
Stockholders' Equity |
|
$ |
67,580 |
|
|
$ |
12,419 |
|
|
|
|
|
|
|
|
|
|
|
ADVANCED
MICRO DEVICES, INC.SELECTED CASH FLOW
INFORMATION(Millions) (Unaudited) |
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
|
December 31,2022 |
|
December 25,2021 |
|
December 31,2022 |
|
December 25,2021 |
Net cash provided by
(used in) |
|
|
|
|
|
|
|
|
Operating activities |
|
$ |
567 |
|
|
$ |
822 |
|
|
$ |
3,565 |
|
|
$ |
3,521 |
|
Investing activities |
|
$ |
1,067 |
|
|
$ |
— |
|
|
$ |
1,999 |
|
|
$ |
(686 |
) |
Financing activities |
|
$ |
(197 |
) |
|
$ |
(727 |
) |
|
$ |
(3,264 |
) |
|
$ |
(1,895 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECTED
CORPORATE DATA(Millions) (Unaudited) |
|
|
|
|
|
|
|
Three Months Ended |
|
Year Ended |
|
|
December 31,2022 |
|
December 25, 2021 |
|
December 31,2022 |
|
December 25,2021 |
Segment and Category
Information(1) |
|
|
|
|
|
|
|
|
Data Center |
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
1,655 |
|
|
$ |
1,163 |
|
|
$ |
6,043 |
|
|
$ |
3,694 |
|
Operating income |
|
$ |
444 |
|
|
$ |
369 |
|
|
$ |
1,848 |
|
|
$ |
991 |
|
Client |
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
903 |
|
|
$ |
1,829 |
|
|
$ |
6,201 |
|
|
$ |
6,887 |
|
Operating income (loss) |
|
$ |
(152 |
) |
|
$ |
530 |
|
|
$ |
1,190 |
|
|
$ |
2,088 |
|
Gaming |
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
1,644 |
|
|
$ |
1,763 |
|
|
$ |
6,805 |
|
|
$ |
5,607 |
|
Operating income |
|
$ |
266 |
|
|
$ |
407 |
|
|
$ |
953 |
|
|
$ |
934 |
|
Embedded |
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
1,397 |
|
|
$ |
71 |
|
|
$ |
4,552 |
|
|
$ |
246 |
|
Operating income |
|
$ |
699 |
|
|
$ |
18 |
|
|
$ |
2,252 |
|
|
$ |
44 |
|
All Other |
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
Operating loss |
|
$ |
(1,406 |
) |
|
$ |
(117 |
) |
|
$ |
(4,979 |
) |
|
$ |
(409 |
) |
Total |
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
5,599 |
|
|
$ |
4,826 |
|
|
$ |
23,601 |
|
|
$ |
16,434 |
|
Operating income (loss) |
|
$ |
(149 |
) |
|
$ |
1,207 |
|
|
$ |
1,264 |
|
|
$ |
3,648 |
|
|
|
|
|
|
|
|
|
|
Other
Data |
|
|
|
|
|
|
|
|
Capital expenditures |
|
$ |
124 |
|
|
$ |
86 |
|
|
$ |
450 |
|
|
$ |
301 |
|
Adjusted EBITDA(2) |
|
$ |
1,438 |
|
|
$ |
1,446 |
|
|
$ |
6,971 |
|
|
$ |
4,476 |
|
Cash, cash equivalents and
short-term investments |
|
$ |
5,855 |
|
|
$ |
3,608 |
|
|
$ |
5,855 |
|
|
$ |
3,608 |
|
Free cash flow(3) |
|
$ |
443 |
|
|
$ |
736 |
|
|
$ |
3,115 |
|
|
$ |
3,220 |
|
Total assets |
|
$ |
67,580 |
|
|
$ |
12,419 |
|
|
$ |
67,580 |
|
|
$ |
12,419 |
|
Total debt |
|
$ |
2,467 |
|
|
$ |
313 |
|
|
$ |
2,467 |
|
|
$ |
313 |
|
(1) |
|
The Data Center segment primarily includes server microprocessors
(CPUs) and graphics processing units (GPUs), data processing units
(DPUs), Field Programmable Gate Arrays (FPGAs) and Adaptive
System-on-Chip (SoC) products for data centers. |
|
|
|
|
|
The Client segment primarily includes CPUs, accelerated processing
units that integrate microprocessors and GPUs (APUs), and chipsets
for desktop and notebook personal computers. |
|
|
|
|
|
The Gaming segment primarily includes discrete GPUs, semi-custom
SoC products and development services. |
|
|
|
|
|
The Embedded segment primarily includes embedded CPUs and GPUs,
FPGAs, and Adaptive SoC products. |
|
|
|
|
|
From time to time, the Company may also sell or license portions of
its IP portfolio. |
|
|
|
|
|
All Other category primarily includes certain expenses and credits
that are not allocated to any of the operating segments, such as
acquisition-related intangible asset amortization expense, employee
stock-based compensation expense, acquisition-related costs and
licensing gain. |
(2) |
|
Reconciliation of GAAP Net Income to Adjusted
EBITDA |
|
|
Three Months Ended |
|
Year Ended |
|
|
December 31,2022 |
|
December 25,2021 |
|
December 31,2022 |
|
December 25,2021 |
GAAP net income |
|
$ |
21 |
|
|
$ |
974 |
|
|
$ |
1,320 |
|
|
$ |
3,162 |
|
Interest expense |
|
|
19 |
|
|
|
8 |
|
|
|
88 |
|
|
|
34 |
|
Other (income) expense, net |
|
|
(32 |
) |
|
|
(4 |
) |
|
|
(8 |
) |
|
|
(55 |
) |
Income tax provision (benefit) |
|
|
(154 |
) |
|
|
229 |
|
|
|
(122 |
) |
|
|
513 |
|
Equity income in investee |
|
|
(3 |
) |
|
|
— |
|
|
|
(14 |
) |
|
|
(6 |
) |
Stock-based compensation |
|
|
310 |
|
|
|
112 |
|
|
|
1,012 |
|
|
|
379 |
|
Depreciation and amortization |
|
|
176 |
|
|
|
118 |
|
|
|
626 |
|
|
|
407 |
|
Amortization of acquired intangible assets |
|
|
1,044 |
|
|
|
— |
|
|
|
3,548 |
|
|
|
— |
|
Acquisition-related costs |
|
|
57 |
|
|
|
9 |
|
|
|
521 |
|
|
|
42 |
|
Adjusted EBITDA |
|
$ |
1,438 |
|
|
$ |
1,446 |
|
|
$ |
6,971 |
|
|
$ |
4,476 |
|
The Company presents “Adjusted EBITDA” as a supplemental measure
of its performance. Adjusted EBITDA for the Company is determined
by adjusting GAAP net income for interest expense, other income
(expense), net, income tax provision (benefit), equity income in
investee, stock-based compensation, depreciation and amortization
expense and acquisition-related costs. The Company also included
amortization of acquired intangible assets for the three months and
year ended December 31, 2022. The Company calculates and presents
Adjusted EBITDA because management believes it is of importance to
investors and lenders in relation to its overall capital structure
and its ability to borrow additional funds. In addition, the
Company presents Adjusted EBITDA because it believes this measure
assists investors in comparing its performance across reporting
periods on a consistent basis by excluding items that the Company
does not believe are indicative of its core operating performance.
The Company’s calculation of Adjusted EBITDA may or may not be
consistent with the calculation of this measure by other companies
in the same industry. Investors should not view Adjusted EBITDA as
an alternative to the GAAP operating measure of income or GAAP
liquidity measures of cash flows from operating, investing and
financing activities. In addition, Adjusted EBITDA does not take
into account changes in certain assets and liabilities that can
affect cash flows.
(3) |
|
Reconciliation of GAAP Net Cash Provided by Operating
Activities to Free Cash Flow |
|
|
Three Months Ended |
|
Year Ended |
|
|
December 31, 2022 |
|
December 25, 2021 |
|
December 31, 2022 |
|
December 25, 2021 |
GAAP net cash provided by operating activities |
|
$ |
567 |
|
|
$ |
822 |
|
|
$ |
3,565 |
|
|
$ |
3,521 |
|
Operating cash flow margin % |
|
|
10 |
% |
|
|
17 |
% |
|
|
15 |
% |
|
|
21 |
% |
Purchases of property and equipment |
|
$ |
(124 |
) |
|
$ |
(86 |
) |
|
$ |
(450 |
) |
|
$ |
(301 |
) |
Free cash flow |
|
$ |
443 |
|
|
$ |
736 |
|
|
$ |
3,115 |
|
|
$ |
3,220 |
|
Free cash flow margin % |
|
|
8 |
% |
|
|
15 |
% |
|
|
13 |
% |
|
|
20 |
% |
The Company also presents free cash flow as a supplemental
Non-GAAP measure of its performance. Free cash flow is determined
by adjusting GAAP net cash provided by operating activities for
capital expenditures, and free cash flow margin % is free cash flow
expressed as a percentage of the Company's net revenue. The Company
calculates and communicates free cash flow in the financial
earnings press release because management believes it is of
importance to investors to understand the nature of these cash
flows. The Company’s calculation of free cash flow may or may not
be consistent with the calculation of this measure by other
companies in the same industry. Investors should not view free cash
flow as an alternative to GAAP liquidity measures of cash flows
from operating activities.
Media Contact:Drew
PrairieAMD
Communications512-602-4425drew.prairie@amd.com
Investor Contact:Suresh
BhaskaranAMD Investor
Relations408-749-2845suresh.bhaskaran@amd.com
Advanced Micro Devices (NASDAQ:AMD)
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