AMD (NASDAQ:AMD) today announced revenue for the third quarter of
2017 of $1.64 billion, operating income of $126 million and net
income of $71 million, and diluted earnings per share of $0.07. On
a non-GAAP(1) basis, operating income was $155 million, net income
was $110 million, and diluted earnings per share was $0.10.
GAAP Financial Results |
|
|
|
|
|
|
|
|
|
Q3-17 |
|
Q2-17 |
|
Q3-16 |
Revenue |
|
$1.64B |
|
$1.22B |
|
$1.31B |
Operating income
(loss) |
|
$126M |
|
$25M |
|
$(293)M |
Net income (loss) |
|
$71M |
|
$(16)M |
|
$(406)M |
Earnings (loss) per
share |
|
$ |
0.07 |
|
$ |
(0.02 |
) |
|
$ |
(0.50 |
) |
Non-GAAP Financial Results(1) |
|
|
|
|
|
|
|
|
|
Q3-17 |
|
Q2-17 |
|
Q3-16 |
Revenue |
|
$1.64B |
|
$1.22B |
|
$1.31B |
Operating income |
|
$155M |
|
$49M |
|
$70M |
Net income |
|
$110M |
|
$19M |
|
$27M |
Earnings per share |
|
$ |
0.10 |
|
$ |
0.02 |
|
$ |
0.03 |
“Strong customer adoption of our new
high-performance products drove significant revenue growth and
improved financial results from a year ago,” said Dr. Lisa Su, AMD
president and CEO. “Our third quarter new product introductions and
financial execution mark another important milestone as we
establish AMD as a premier growth company in the technology
industry.”
Q3 2017 Results
- Revenue was $1.64 billion, up 26 percent year-over-year,
primarily driven by higher revenue in the Computing and Graphics
segment (CG). Revenue was up 34 percent sequentially, driven by the
Enterprise Embedded and Semi-Custom segment (EESC) revenue
seasonality and higher revenue in CG. In the quarter, AMD closed a
patent licensing transaction which positively impacted revenue in
the segments.
- On a GAAP basis, gross margin was 35 percent, up 30 percentage
points year-over-year primarily due to a $340 million charge
related to our GLOBALFOUNDRIES Wafer Supply Agreement (WSA) in the
year ago period (WSA charge). In addition, the gross margin
increase was primarily driven by the benefit from IP related
revenue and a richer revenue mix from CG partially offset by costs
associated with the WSA for certain wafers purchased at another
foundry. Gross margin was up 2 percentage points sequentially
primarily driven by the benefit from IP related revenue, partially
offset by costs associated with the WSA for certain wafers
purchased at another foundry. Operating income was $126 million
compared to an operating loss of $293 million a year ago and
operating income of $25 million in the prior quarter. Net income
was $71 million compared to net losses of $406 million a year ago
and $16 million in the prior quarter. Diluted earnings per share
was $0.07 compared to losses per share of $0.50 a year ago and
$0.02 in the prior quarter.
- On a non-GAAP(1) basis, gross margin was 35 percent, up 4
percentage points year-over-year primarily driven by the benefit
from IP related revenue and a richer revenue mix from CG, partially
offset by costs associated with the WSA for certain wafers
purchased at another foundry. Gross margin was up 2 percentage
points sequentially primarily driven by the benefit from IP related
revenue, partially offset by costs associated with the WSA for
certain wafers purchased at another foundry. Operating income
was $155 million compared to $70 million a year ago and $49 million
in the prior quarter. Net income was $110 million compared to $27
million a year ago and $19 million in the prior quarter. Diluted
earnings per share was $0.10 compared to $0.03 a year ago and $0.02
in the prior quarter.
- Cash, cash equivalents, and marketable securities were $879
million at the end of the quarter, compared to $844 million in the
prior quarter.
Quarterly Financial Segment Summary
- Computing and Graphics segment revenue was $819 million, up 74
percent year-over-year primarily driven by strong sales of RadeonTM
graphics and RyzenTM desktop processors.
- Client average selling price (ASP) increased significantly
year-over-year, due to higher desktop processor ASP driven by
RyzenTM processor sales.
- GPU ASP increased significantly year-over-year.
- Operating income was $70 million, compared to an operating loss
of $66 million a year ago. The year-over-year improvement was
primarily driven by higher revenue.
- Enterprise, Embedded and Semi-Custom segment revenue was $824
million, approximately flat year-over-year primarily driven by
lower semi-custom SoC sales, mostly offset by IP related and EPYCTM
processor revenue.
- Operating income was $84 million, compared to $136 million a
year ago. The year-over-year decrease was primarily due to higher
costs partially offset by the net benefit of IP related items.
- All Other operating loss was $28 million compared with an
operating loss of $363 million a year ago. The year-over-year
difference in operating loss was primarily related to the WSA
charge in the year ago period.
Q3 2017 Highlights
- AMD continued driving innovation and competition into the
consumer and commercial PC markets with new Ryzen™ processors:
- Ryzen™ Threadripper™ processors launched for the High End
Desktop and workstation markets. Available in 8-, 16- and 12-core
variants, ThreadripperTM processors are available from over 90
retailers, OEMs, and system integrators worldwide, including in the
Alienware Area-51 Threadripper™ Edition gaming PC, BOXX APEXX 4
6301 and NextComputing Edge TR workstations.
- Ryzen™ 3 CPUs offer exceptional responsiveness and performance
at mainstream pricing, completing the Ryzen™ mainstream desktop
lineup.
- RyzenTM PRO desktop solutions have received broad support from
top global commercial PC suppliers, including Dell, HP, and
Lenovo.
- AMD expanded its graphics offerings with new consumer,
professional, and embedded graphics solutions:
- Launched the “Vega” architecture-based Radeon™ RX Vega family
of GPUs, marking a return to the enthusiast-class gaming segment.
These new “Vega” architecture-based GPUs combine cutting-edge
capabilities with 8GB of HBM2 memory to deliver up to 13.7 TFLOPS
of peak performance.
- Launched the Radeon™ Pro WX 9100 professional graphics card,
delivering up to 12.3 TFLOPS of peak single precision compute
performance.
- Launched the Embedded Radeon™ E9170 Series GPU, which delivers
up to 3X the performance-per-watt over previous generations, and is
targeted at digital casino games, thin clients, medical displays,
digital and retail signage, and industrial systems(2).
- With new announcements from Amazon Web Services (AWS), and
Tencent, AMD enterprise solutions have now been chosen by five of
the “Super 7” datacenter and cloud services companies. Previously
announced collaborations include Alibaba, Baidu and Microsoft
Azure.
- Amazon Web Services selected AMD RadeonTM Pro MxGPU technology
for the new Graphics Design instance type on Amazon AppStream 2.0,
which allows users to run graphics-accelerated applications at a
fraction of the cost of using graphics workstations.
- Tencent announced plans to use AMD EPYC™ 7000 series server
processors in their datacenters.
- Atari disclosed that a customized AMD processor featuring
Radeon™ graphics technology will power the upcoming Ataribox game
console, which is targeted for global launch in spring 2018.
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 fourth quarter of 2017, AMD expects revenue to decrease
approximately 15 percent sequentially, plus or minus 3 percent. The
midpoint of guidance would result in fourth quarter 2017 revenue
increasing approximately 26 percent year-over-year. AMD now expects
annual 2017 revenue to increase by greater than 20 percent,
compared to prior guidance of mid-to-high teens percentage.
For additional details regarding AMD’s results and outlook
please see the CFO commentary posted at
quarterlyearnings.amd.com.
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 third quarter 2017 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. The webcast
will be available for 12 months after the conference call.
Reconciliation of GAAP to Non-GAAP Gross
Margin |
|
|
|
|
|
|
|
|
|
|
|
(Millions except
percentages) |
|
Q3-17 |
|
Q2-17 |
|
Q3-16 |
GAAP Gross
Margin |
|
$ |
573 |
|
|
$ |
404 |
|
|
$ |
59 |
|
GAAP Gross
Margin % |
|
35 |
% |
|
33 |
% |
|
5 |
% |
Charge
related to the sixth amendment to the WSA with GF |
|
— |
|
|
— |
|
|
340 |
|
Stock-based compensation |
|
1 |
|
|
1 |
|
|
— |
|
Non-GAAP Gross
Margin |
|
$ |
574 |
|
|
$ |
405 |
|
|
$ |
399 |
|
Non-GAAP Gross
Margin % |
|
35 |
% |
|
33 |
% |
|
31 |
% |
Reconciliation of GAAP Operating Income (loss) to Non-GAAP
Operating Income |
|
|
|
|
|
|
|
(Millions) |
|
Q3-17 |
|
Q2-17 |
|
Q3-16 |
GAAP operating
income (loss) |
|
$ |
126 |
|
|
$ |
25 |
|
|
$ |
(293 |
) |
Charge
related to the sixth amendment to the WSA with GF |
|
— |
|
|
— |
|
|
340 |
|
Stock-based compensation |
|
29 |
|
|
24 |
|
|
23 |
|
Non-GAAP
operating income |
|
$ |
155 |
|
|
$ |
49 |
|
|
$ |
70 |
|
Reconciliation of GAAP Net Income (Loss) / Earnings (Loss)
Per Share to Non-GAAP Net Income / Diluted Earnings Per
Share |
|
|
|
|
|
|
|
|
|
|
|
|
|
(Millions except per
share amounts) |
|
Q3-17 |
|
Q2-17 |
|
Q3-16 |
GAAP net income
(loss) / earnings (loss) per share |
|
$ |
71 |
|
|
$ |
0.07 |
|
|
$ |
(16 |
) |
|
$ |
(0.02 |
) |
|
$ |
(406 |
) |
|
$ |
(0.50 |
) |
Charge
related to the sixth amendment to the WSA with GF |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
340 |
|
|
0.39 |
|
Loss on
debt redemption |
|
2 |
|
|
— |
|
|
3 |
|
|
— |
|
|
61 |
|
|
0.07 |
|
Non-cash
interest expense related to convertible debt |
|
6 |
|
|
0.01 |
|
|
5 |
|
|
0.01 |
|
|
1 |
|
|
— |
|
Stock-based compensation |
|
29 |
|
|
0.02 |
|
|
24 |
|
|
0.02 |
|
|
23 |
|
|
0.03 |
|
Equity
loss in investee |
|
2 |
|
|
— |
|
|
3 |
|
|
— |
|
|
5 |
|
|
0.01 |
|
Gain on
sale of 85% of ATMP JV |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
4 |
|
|
— |
|
Tax
provision related to sale of 85% of ATMP JV |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(1 |
) |
|
— |
|
Non-GAAP net
income / diluted earnings per share |
|
$ |
110 |
|
|
$ |
0.10 |
|
|
$ |
19 |
|
|
$ |
0.02 |
|
|
$ |
27 |
|
|
$ |
0.03 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q3 2017
GAAP diluted earnings per share calculated based on
1,042 million shares and non-GAAP diluted earnings per share
is calculated based on 1,143 million shares, which includes
100.6 million shares related to the Company’s 2026 convertible
notes and also includes a $5 million cash interest expense add-back
to net income under the "if converted" method. Q3 2016 GAAP
basic net loss per share is calculated based on 815 million shares
and non-GAAP diluted earnings per share is calculated based on 865
million shares. |
About AMDFor more than 45 years, AMD has driven
innovation in high-performance computing, graphics, and
visualization technologies - the building blocks for gaming,
immersive platforms, and the datacenter. Hundreds of millions of
consumers, leading Fortune 500 businesses, and cutting-edge
scientific research facilities around the world rely on AMD
technology daily to improve how they live, work, and play. AMD
employees around the world are focused on building great products
that push the boundaries of what is possible. For more information
about how AMD is enabling today and inspiring tomorrow, visit the
AMD (NASDAQ:AMD) website, blog, Facebook and Twitter pages.
Cautionary StatementThis document contains
forward-looking statements concerning Advanced Micro Devices, Inc.
(AMD) including AMD's ability to become a premier growth company in
the technology industry and AMD's expected fourth quarter 2017
revenue and annual 2017 revenue, 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
document are based on current beliefs, assumptions and
expectations, speak only as of the date of this document 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 may limit AMD’s ability to compete
effectively; AMD has a wafer supply agreement with GLOBALFOUNDRIES
Inc. (GF) with obligations to purchase all of its microprocessor
and APU product requirements, and a certain portion of its GPU
product requirements from GF with limited exceptions. If GF is not
able to satisfy AMD’s manufacturing requirements, AMD's business
could be adversely impacted; AMD relies on third parties to
manufacture its products, and if they are unable to do so on a
timely basis in sufficient quantities and using competitive
technologies, AMD’s business could be materially adversely
affected; failure to achieve expected manufacturing yields for
AMD’s products could negatively impact its financial results; the
success of AMD’s business is dependent upon its ability to
introduce products on a timely basis with features and performance
levels that provide value to its customers while supporting and
coinciding with significant industry transitions; if AMD cannot
generate sufficient revenue and operating cash flow or obtain
external financing, it may face a cash shortfall and be unable to
make all of its planned investments in research and development or
other strategic investments; the loss of a significant customer may
have a material adverse effect on AMD; AMD’s receipt of revenue
from its semi-custom SoC products is dependent upon its technology
being designed into third-party products and the success of those
products; global economic uncertainty may adversely impact AMD’s
business and operating results; the markets in which AMD’s products
are sold are highly competitive; AMD may not be able to generate
sufficient cash to service its debt obligations or meet its working
capital requirements; AMD has a large amount of indebtedness which
could adversely affect its financial position and prevent it from
implementing its strategy or fulfilling its contractual
obligations; the agreements governing AMD’s notes and the Secured
Revolving Line of Credit impose restrictions on AMD that may
adversely affect its ability to operate its business; AMD's
issuance to West Coast Hitech L.P. (WCH) of warrants to purchase 75
million shares of its common stock, if and when exercised, will
dilute the ownership interests of AMD's existing stockholders, and
the conversion of the 2.125% Convertible Senior Notes due 2026 may
dilute the ownership interest of AMD's existing stockholders, or
may otherwise depress the price of its common stock; uncertainties
involving the ordering and shipment of AMD’s products could
materially adversely affect it; the demand for AMD’s products
depends in part on the market conditions in the industries into
which they are sold. Fluctuations in demand for AMD’s products or a
market decline in any of these industries could have a material
adverse effect on its results of operations; AMD’s ability to
design and introduce new products in a timely manner is dependent
upon third-party intellectual property; AMD depends on third-party
companies for the design, manufacture and supply of motherboards,
software and other computer platform components to support its
business; if AMD loses Microsoft Corporation’s support for its
products or other software vendors do not design and develop
software to run on AMD’s products, its ability to sell its products
could be materially adversely affected; AMD’s reliance on
third-party distributors and AIB partners subjects it to certain
risks; AMD’s inability to continue to attract and retain qualified
personnel may hinder its business; in the event of a change of
control, AMD may not be able to repurchase its outstanding debt as
required by the applicable indentures and its Secured Revolving
Line of Credit, which would result in a default under the
indentures and its Secured Revolving Line of Credit; the
semiconductor industry is highly cyclical and has experienced
severe downturns that have materially adversely affected, and may
continue to materially adversely affect its business in the
future; acquisitions, divestitures and/or joint ventures could
disrupt its business, harm its financial condition and operating
results or dilute, or adversely affect the price of, its common
stock; AMD’s business is dependent upon the proper functioning of
its internal business processes and information systems and
modification or interruption of such systems may disrupt its
business, processes and internal controls; data breaches and
cyber-attacks could compromise AMD’s intellectual property or other
sensitive information, be costly to remediate and cause significant
damage to its business and reputation; AMD’s operating results are
subject to quarterly and seasonal sales patterns; if essential
equipment, materials or manufacturing processes are not available
to manufacture its products, AMD could be materially adversely
affected; if AMD’s products are not compatible with some or all
industry-standard software and hardware, it could be materially
adversely affected; costs related to defective products could have
a material adverse effect on AMD; if AMD fails to maintain the
efficiency of its supply chain as it responds to changes in
customer demand for its products, its business could be materially
adversely affected; AMD outsources to third parties certain
supply-chain logistics functions, including portions of its product
distribution, transportation management and information technology
support services; AMD may incur future impairments of goodwill;
AMD's stock price is subject to volatility; AMD’s worldwide
operations are subject to political, legal and economic risks and
natural disasters, which could have a material adverse effect on
it; worldwide political conditions may adversely affect demand for
AMD’s products; unfavorable currency exchange rate fluctuations
could adversely affect AMD; AMD’s inability to effectively control
the sales of its products on the gray market could have a material
adverse effect on it; if AMD cannot adequately protect its
technology or other intellectual property in the United States and
abroad, through patents, copyrights, trade secrets, trademarks and
other measures, it may lose a competitive advantage and incur
significant expenses; AMD is a party to litigation and may become a
party to other claims or litigation that could cause it to incur
substantial costs or pay substantial damages or prohibit it from
selling its products; AMD’s business is subject to potential tax
liabilities; and AMD is subject to environmental laws, conflict
minerals-related provisions of the Dodd-Frank Wall Street Reform
and Consumer Protection Act as well as a variety of other laws or
regulations that could result in additional costs and liabilities.
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 Quarterly Report on Form 10-Q for the quarter
ended July 1, 2017.
AMD, the AMD Arrow logo, EPYC, Radeon, Radeon
Instinct, Ryzen, 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.
1. |
In this earnings press
release, in addition to GAAP financial results, AMD has provided
non-GAAP financial measures including non-GAAP gross margin,
non-GAAP operating income (loss), non-GAAP net income (loss) and
non-GAAP earnings (loss) per share. These non-GAAP financial
measures reflect certain adjustments as presented in the tables in
this earnings press release. 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. 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.
Refer to the data tables at the end of this earnings press
release. |
2. |
AMD Embedded Radeon™
E6760 with 6 compute units (CU) and configured at standard engine
clock speed 600 MHz can reach a maximum of 461 GFLOPS SP within
thermal design power (TDP) of 30W, yielding 15.36 GFLOPS/W.
AMD Embedded Radeon™ E9173 with 8 CUs and configured at
standard engine clock speed 1124 MHz can reach a maximum of 1151
GFLOPS SP within TDP of 25W, yielding 46.04 GFLOPS/W, achieving
nearly 3x performance-per-watt compared to AMD Embedded Radeon™
E6760, EMB-142. |
ADVANCED MICRO DEVICES, INC.CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS(Millions
except per share amounts and percentages)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2017 |
|
July 1, 2017 |
|
September 24, 2016 |
|
September 30, 2017 |
|
September 24, 2016 |
Net revenue |
|
$ |
1,643 |
|
|
$ |
1,222 |
|
|
$ |
1,307 |
|
|
$ |
3,849 |
|
|
$ |
3,166 |
|
Cost of sales |
|
1,070 |
|
|
818 |
|
|
1,248 |
|
|
$ |
2,541 |
|
|
$ |
2,519 |
|
Gross margin |
|
573 |
|
|
404 |
|
|
59 |
|
|
1,308 |
|
|
647 |
|
Gross margin % |
|
35 |
% |
|
33 |
% |
|
5 |
% |
|
34 |
% |
|
20 |
% |
Research and
development |
|
315 |
|
|
279 |
|
|
259 |
|
|
860 |
|
|
744 |
|
Marketing, general and
administrative |
|
132 |
|
|
125 |
|
|
117 |
|
|
378 |
|
|
339 |
|
Restructuring and other
special charges, net |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(10 |
) |
Licensing gain |
|
— |
|
|
(25 |
) |
|
(24 |
) |
|
(52 |
) |
|
(57 |
) |
Operating income
(loss) |
|
126 |
|
|
25 |
|
|
(293 |
) |
|
122 |
|
|
(369 |
) |
Interest expense |
|
(31 |
) |
|
(32 |
) |
|
(41 |
) |
|
(95 |
) |
|
(122 |
) |
Other income (expense),
net |
|
(3 |
) |
|
(3 |
) |
|
(63 |
) |
|
(11 |
) |
|
87 |
|
Income (loss) before
equity loss and income taxes |
|
92 |
|
|
(10 |
) |
|
(397 |
) |
|
16 |
|
|
(404 |
) |
Provision for income
taxes |
|
19 |
|
|
3 |
|
|
4 |
|
|
27 |
|
|
34 |
|
Equity loss in
investee |
|
(2 |
) |
|
(3 |
) |
|
(5 |
) |
|
(7 |
) |
|
(8 |
) |
Net Income (loss) |
|
$ |
71 |
|
|
$ |
(16 |
) |
|
$ |
(406 |
) |
|
$ |
(18 |
) |
|
$ |
(446 |
) |
Earnings (loss) per
share |
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.07 |
|
|
$ |
(0.02 |
) |
|
$ |
(0.50 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.56 |
) |
Diluted |
|
$ |
0.07 |
|
|
$ |
(0.02 |
) |
|
$ |
(0.50 |
) |
|
$ |
(0.02 |
) |
|
$ |
(0.56 |
) |
Shares used in per
share calculation |
|
|
|
|
|
|
|
|
|
|
Basic |
|
957 |
|
|
945 |
|
|
815 |
|
|
947 |
|
|
801 |
|
Diluted |
|
1,042 |
|
|
945 |
|
|
815 |
|
|
947 |
|
|
801 |
|
ADVANCED MICRO DEVICES,
INC.CONDENSED CONSOLIDATED STATEMENTS OF
COMPREHENSIVE INCOME (LOSS)(Millions)
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2017 |
|
July 1, 2017 |
|
September 24, 2016 |
|
September 30, 2017 |
|
September 24, 2016 |
Total comprehensive
income (loss) |
|
$ |
73 |
|
|
$ |
(12 |
) |
|
$ |
(406 |
) |
|
$ |
(11 |
) |
|
$ |
(441 |
) |
ADVANCED MICRO DEVICES, INC.CONDENSED
CONSOLIDATED BALANCE
SHEETS (Millions)
|
|
September 30, 2017 |
|
December 31, 2016 |
Assets |
|
|
|
|
Current assets: |
|
|
|
|
Cash and
cash equivalents |
|
$ |
879 |
|
|
$ |
1,264 |
|
Accounts
receivable, net |
|
771 |
|
|
311 |
|
Inventories, net |
|
794 |
|
|
751 |
|
Prepayment and other receivables - related parties |
|
26 |
|
|
32 |
|
Prepaid
expenses |
|
72 |
|
|
63 |
|
Other
current assets |
|
157 |
|
|
109 |
|
Total
current assets |
|
2,699 |
|
|
2,530 |
|
Property, plant and
equipment, net |
|
236 |
|
|
164 |
|
Goodwill |
|
289 |
|
|
289 |
|
Investment: equity
method |
|
57 |
|
|
59 |
|
Other assets |
|
305 |
|
|
279 |
|
Total Assets |
|
$ |
3,586 |
|
|
$ |
3,321 |
|
Liabilities and
Stockholders' Equity |
|
|
|
|
Current
liabilities: |
|
|
|
|
Short-term debt |
|
70 |
|
|
— |
|
Accounts
payable |
|
472 |
|
|
440 |
|
Payables
to related parties |
|
444 |
|
|
383 |
|
Accrued
liabilities |
|
460 |
|
|
391 |
|
Other
current liabilities |
|
73 |
|
|
69 |
|
Deferred
income on shipments to distributors |
|
72 |
|
|
63 |
|
Total
current liabilities |
|
1,591 |
|
|
1,346 |
|
Long-term debt,
net |
|
1,356 |
|
|
1,435 |
|
Other long-term
liabilities |
|
119 |
|
|
124 |
|
Stockholders'
equity: |
|
|
|
|
Capital
stock: |
|
|
|
|
Common
stock, par value |
|
10 |
|
|
9 |
|
Additional paid-in capital |
|
8,437 |
|
|
8,334 |
|
Treasury
stock, at cost |
|
(108 |
) |
|
(119 |
) |
Accumulated deficit |
|
(7,821 |
) |
|
(7,803 |
) |
Accumulated other comprehensive income (loss) |
|
2 |
|
|
(5 |
) |
Total
Stockholders' equity |
|
$ |
520 |
|
|
$ |
416 |
|
Total Liabilities and
Stockholders' Equity |
|
$ |
3,586 |
|
|
$ |
3,321 |
|
ADVANCED MICRO DEVICES, INC.CONDENSED
CONSOLIDATED STATEMENT OF CASH
FLOWS(Millions)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2017 |
|
September 30, 2017 |
Cash flows from
operating activities: |
|
|
|
|
Net
Income (loss) |
|
$ |
71 |
|
|
$ |
(18 |
) |
Adjustments to reconcile net income (loss) to net cash provided by
(used in) operating activities: |
|
|
|
|
Depreciation and amortization |
|
36 |
|
|
105 |
|
Stock-based compensation expense |
|
29 |
|
|
76 |
|
Non-cash
interest expense |
|
9 |
|
|
27 |
|
Loss on
debt redemption |
|
2 |
|
|
9 |
|
Other |
|
3 |
|
|
4 |
|
Changes
in operating assets and liabilities: |
|
|
|
|
Accounts
receivable |
|
(157 |
) |
|
(460 |
) |
Inventories |
|
39 |
|
|
(43 |
) |
Prepayment and other receivables - related parties |
|
(16 |
) |
|
6 |
|
Prepaid
expenses and other assets |
|
(26 |
) |
|
(82 |
) |
Payables
to related parties |
|
70 |
|
|
61 |
|
Accounts
payable, accrued liabilities and other |
|
6 |
|
|
— |
|
Net cash provided by
(used in) operating activities |
|
$ |
66 |
|
|
$ |
(315 |
) |
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
Purchases
of property, plant and equipment |
|
(34 |
) |
|
(69 |
) |
Purchases
of available-for-sale securities |
|
— |
|
|
(221 |
) |
Proceeds
from maturity of available-for-sale securities |
|
85 |
|
|
221 |
|
Other |
|
— |
|
|
(2 |
) |
Net cash provided by
(used in) investing activities |
|
$ |
51 |
|
|
(71 |
) |
|
|
|
|
|
Cash flows from
financing activities: |
|
|
|
|
Proceeds
from borrowings, net |
|
28 |
|
|
70 |
|
Proceeds
from issuance of common stock under stock-based compensation equity
plans |
|
5 |
|
|
15 |
|
Repayments of long-term debt |
|
(28 |
) |
|
(70 |
) |
Other |
|
(3 |
) |
|
(14 |
) |
Net cash provided by
financing activities |
|
$ |
2 |
|
|
$ |
1 |
|
Net increase (decrease)
in cash and cash equivalents |
|
119 |
|
|
(385 |
) |
Cash and cash
equivalents at beginning of period |
|
$ |
760 |
|
|
$ |
1,264 |
|
Cash and cash
equivalents at end of period |
|
$ |
879 |
|
|
$ |
879 |
|
ADVANCED MICRO DEVICES, INC.SELECTED
CORPORATE DATA(Millions)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2017 |
|
July 1, 2017 |
|
September 24, 2016 |
|
September 30, 2017 |
|
September 24, 2016 |
Segment and Category
Information |
|
|
|
|
|
|
|
|
|
|
Computing
and Graphics (1) |
|
|
|
|
|
|
|
|
|
|
Net
revenue |
|
$ |
819 |
|
|
$ |
659 |
|
|
$ |
472 |
|
|
$ |
2,071 |
|
|
$ |
1,367 |
|
Operating
income (loss) |
|
$ |
70 |
|
|
$ |
7 |
|
|
$ |
(66 |
) |
|
$ |
62 |
|
|
$ |
(217 |
) |
Enterprise, Embedded and Semi-Custom (2) |
|
|
|
|
|
|
|
|
|
|
Net
revenue |
|
824 |
|
|
563 |
|
|
835 |
|
|
1,778 |
|
|
1,799 |
|
Operating
income |
|
84 |
|
|
42 |
|
|
136 |
|
|
135 |
|
|
236 |
|
All Other
(3) |
|
|
|
|
|
|
|
|
|
|
Net
revenue |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Operating
loss |
|
(28 |
) |
|
(24 |
) |
|
(363 |
) |
|
(75 |
) |
|
(388 |
) |
Total |
|
|
|
|
|
|
|
|
|
|
Net
revenue |
|
$ |
1,643 |
|
|
$ |
1,222 |
|
|
$ |
1,307 |
|
|
$ |
3,849 |
|
|
$ |
3,166 |
|
Operating
income (loss) |
|
$ |
126 |
|
|
$ |
25 |
|
|
$ |
(293 |
) |
|
$ |
122 |
|
|
$ |
(369 |
) |
Other Data |
|
|
|
|
|
|
|
|
|
|
Capital
expenditures (4) |
|
$ |
34 |
|
|
$ |
12 |
|
|
$ |
9 |
|
|
$ |
69 |
|
|
$ |
56 |
|
Adjusted
EBITDA (5) |
|
$ |
191 |
|
|
$ |
84 |
|
|
$ |
103 |
|
|
$ |
303 |
|
|
$ |
117 |
|
Cash,
cash equivalents and marketable securities |
|
$ |
879 |
|
|
$ |
844 |
|
|
$ |
1,258 |
|
|
$ |
879 |
|
|
$ |
1,258 |
|
Free cash
flow (6) |
|
$ |
32 |
|
|
$ |
(94 |
) |
|
$ |
20 |
|
|
$ |
(384 |
) |
|
$ |
(154 |
) |
Total
assets |
|
$ |
3,586 |
|
|
$ |
3,370 |
|
|
$ |
3,616 |
|
|
$ |
3,586 |
|
|
$ |
3,616 |
|
Total
debt |
|
$ |
1,426 |
|
|
$ |
1,417 |
|
|
$ |
1,632 |
|
|
$ |
1,426 |
|
|
$ |
1,632 |
|
(1 |
) |
The Computing and
Graphics segment primarily includes desktop and notebook processors
and chipsets, discrete graphics processing units (GPUs) and
professional graphics processors. The Company also licenses
portions of its intellectual property portfolio. |
|
|
(2 |
) |
The Enterprise,
Embedded and Semi-Custom segment primarily includes server and
embedded processors, semi-custom System-on-Chip (SoC) products,
development services and technology for game consoles. The Company
also licenses portions of its intellectual property portfolio. |
|
|
(3 |
) |
All Other category
primarily includes certain expenses and credits that are not
allocated to any of the operating segments. Also included in this
category is stock-based compensation expense. In addition, the
Company also included a charge related to the sixth amendment to
the WSA with GF for the three and nine months ended September 24,
2016 and restructuring and other special charges, net for the nine
months ended September 24, 2016. |
|
|
(4 |
) |
Starting in Q1 2017,
the Company classifies production mask sets as property, plant and
equipment on its balance sheet. |
|
|
(5 |
) |
Reconciliation of GAAP
Operating Income (Loss) to Adjusted EBITDA* |
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2017 |
|
July 1, 2017 |
|
September 24, 2016 |
|
September 30, 2017 |
|
September 24, 2016 |
GAAP operating income
(loss) |
|
$ |
126 |
|
|
$ |
25 |
|
|
$ |
(293 |
) |
|
$ |
122 |
|
|
$ |
(369 |
) |
Charge
related to the sixth amendment to the WSA with GF |
|
— |
|
|
— |
|
|
340 |
|
|
— |
|
|
340 |
|
Restructuring and other special charges, net |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(10 |
) |
Stock-based compensation |
|
29 |
|
|
24 |
|
|
23 |
|
|
76 |
|
|
57 |
|
Depreciation and amortization |
|
36 |
|
|
35 |
|
|
33 |
|
|
105 |
|
|
99 |
|
Adjusted EBITDA |
|
191 |
|
|
84 |
|
|
103 |
|
|
303 |
|
|
117 |
|
(6) Free cash flow reconciliation**
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2017 |
|
July 1, 2017 |
|
September 24, 2016 |
|
September 30, 2017 |
|
September 24, 2016 |
GAAP net cash provided
by (used in) operating activities |
|
$ |
66 |
|
|
$ |
(82 |
) |
|
$ |
29 |
|
|
$ |
(315 |
) |
|
$ |
(98 |
) |
Purchases
of property, plant and equipment |
|
(34 |
) |
|
(12 |
) |
|
(9 |
) |
|
(69 |
) |
|
(56 |
) |
Free cash flow |
|
$ |
32 |
|
|
$ |
(94 |
) |
|
$ |
20 |
|
|
$ |
(384 |
) |
|
$ |
(154 |
) |
* |
The Company presents
“Adjusted EBITDA” as a supplemental measure of its performance.
Adjusted EBITDA for the Company is determined by adjusting
operating income (loss) for depreciation and amortization and
stock-based compensation expense. In addition, the Company excluded
a charge related to the sixth amendment to the WSA with GF for the
three and nine months ended September 24, 2016 and restructuring
and other special charges, net for the nine months ended September
24, 2016. 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 operating income
(loss) 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 as well as interest income and expense and income taxes
that can affect cash flows. |
|
|
** |
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 (used in) operating activities for capital
expenditures. 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. |
|
|
|
The Company has
provided reconciliations within the earnings press release of these
non-GAAP financial measures to the most directly comparable GAAP
financial measures. |
|
|
|
|
ADVANCED MICRO DEVICES, INC. |
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
|
|
|
(Millions except per share amounts and
percentages) |
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
September 30, 2017 |
July 1, 2017 |
September 24, 2016 |
|
September 30, 2017 |
September 24, 2016 |
Net revenue |
$ |
1,643 |
|
$ |
1,222 |
|
$ |
1,307 |
|
|
$ |
3,849 |
|
$ |
3,166 |
|
Cost of
sales |
|
1,070 |
|
|
818 |
|
|
1,248 |
|
|
|
2,541 |
|
|
2,519 |
|
Gross margin |
|
573 |
|
|
404 |
|
|
59 |
|
|
|
1,308 |
|
|
647 |
|
Gross margin % |
|
35 |
% |
|
33 |
% |
|
5 |
% |
|
|
34 |
% |
|
20 |
% |
Research and
development |
|
315 |
|
|
279 |
|
|
259 |
|
|
|
860 |
|
|
744 |
|
Marketing, general and
administrative |
|
132 |
|
|
125 |
|
|
117 |
|
|
|
378 |
|
|
339 |
|
Restructuring and other
special charges, net |
|
- |
|
|
- |
|
|
- |
|
|
|
- |
|
|
(10 |
) |
Licensing gain |
|
- |
|
|
(25 |
) |
|
(24 |
) |
|
|
(52 |
) |
|
(57 |
) |
Operating income (loss) |
|
126 |
|
|
25 |
|
|
(293 |
) |
|
|
122 |
|
|
(369 |
) |
Interest expense |
|
(31 |
) |
|
(32 |
) |
|
(41 |
) |
|
|
(95 |
) |
|
(122 |
) |
Other income (expense),
net |
|
(3 |
) |
|
(3 |
) |
|
(63 |
) |
|
|
(11 |
) |
|
87 |
|
Income (loss) before equity loss and income taxes |
|
92 |
|
|
(10 |
) |
|
(397 |
) |
|
|
16 |
|
|
(404 |
) |
Provision for income
taxes |
|
19 |
|
|
3 |
|
|
4 |
|
|
|
27 |
|
|
34 |
|
Equity
loss in investee |
|
(2 |
) |
|
(3 |
) |
|
(5 |
) |
|
|
(7 |
) |
|
(8 |
) |
Net Income (loss) |
$ |
71 |
|
$ |
(16 |
) |
$ |
(406 |
) |
|
$ |
(18 |
) |
$ |
(446 |
) |
Earnings (loss) per
share |
|
|
|
|
|
|
Basic |
$ |
0.07 |
|
$ |
(0.02 |
) |
$ |
(0.50 |
) |
|
$ |
(0.02 |
) |
$ |
(0.56 |
) |
Diluted |
$ |
0.07 |
|
$ |
(0.02 |
) |
$ |
(0.50 |
) |
|
$ |
(0.02 |
) |
$ |
(0.56 |
) |
Shares used in per share calculation |
|
|
|
|
|
|
Basic |
|
957 |
|
|
945 |
|
|
815 |
|
|
|
947 |
|
|
801 |
|
Diluted |
|
1,042 |
|
|
945 |
|
|
815 |
|
|
|
947 |
|
|
801 |
|
|
|
|
|
|
|
|
ADVANCED MICRO DEVICES, INC. |
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(LOSS) |
|
|
|
(Millions) |
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
September 30, 2017 |
July 1, 2017 |
September 24, 2016 |
|
September 30, 2017 |
September 24, 2016 |
Total comprehensive income (loss) |
$ |
73 |
|
$ |
(12 |
) |
$ |
(406 |
) |
|
$ |
(11 |
) |
$ |
(441 |
) |
ADVANCED MICRO
DEVICES, INC. |
|
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS |
|
|
|
(Millions) |
|
|
|
|
|
|
|
|
September 30, 2017 |
|
December 31, 2016 |
Assets |
|
|
|
Current assets: |
|
|
|
Cash and
cash equivalents |
$ |
879 |
|
|
$ |
1,264 |
|
Accounts
receivable, net |
|
771 |
|
|
|
311 |
|
Inventories, net |
|
794 |
|
|
|
751 |
|
Prepayment and other receivables - related parties |
|
26 |
|
|
|
32 |
|
Prepaid
expenses |
|
72 |
|
|
|
63 |
|
Other
current assets |
|
157 |
|
|
|
109 |
|
|
|
|
|
Total
current assets |
|
2,699 |
|
|
|
2,530 |
|
Property, plant and
equipment, net |
|
236 |
|
|
|
164 |
|
Goodwill |
|
289 |
|
|
|
289 |
|
Investment: equity
method |
|
57 |
|
|
|
59 |
|
Other assets |
|
305 |
|
|
|
279 |
|
|
|
|
|
Total Assets |
$ |
3,586 |
|
|
$ |
3,321 |
|
|
|
|
|
Liabilities and Stockholders'
Equity |
|
|
|
Current
liabilities: |
|
|
|
Short-term debt |
$ |
70 |
|
|
$ |
- |
|
Accounts
payable |
|
472 |
|
|
|
440 |
|
Payables
to related parties |
|
444 |
|
|
|
383 |
|
Accrued
liabilities |
|
460 |
|
|
|
391 |
|
Other
current liabilities |
|
73 |
|
|
|
69 |
|
Deferred
income on shipments to distributors |
|
72 |
|
|
|
63 |
|
|
|
|
|
Total
current liabilities |
|
1,591 |
|
|
|
1,346 |
|
Long-term debt,
net |
|
1,356 |
|
|
|
1,435 |
|
Other long-term
liabilities |
|
119 |
|
|
|
124 |
|
|
|
|
|
Stockholders'
equity: |
|
|
|
Capital
stock: |
|
|
|
Common
stock, par value |
|
10 |
|
|
|
9 |
|
Additional paid-in capital |
|
8,437 |
|
|
|
8,334 |
|
Treasury
stock, at cost |
|
(108 |
) |
|
|
(119 |
) |
Accumulated deficit |
|
(7,821 |
) |
|
|
(7,803 |
) |
Accumulated other comprehensive income (loss) |
|
2 |
|
|
|
(5 |
) |
|
|
|
|
Total Stockholders' equity |
|
520 |
|
|
|
416 |
|
Total Liabilities and Stockholders'
Equity |
$ |
3,586 |
|
|
$ |
3,321 |
|
ADVANCED MICRO
DEVICES, INC. |
|
|
|
CONDENSED
CONSOLIDATED STATEMENT OF CASH FLOWS |
|
|
|
(Millions) |
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
September 30, 2017 |
|
September 30, 2017 |
|
|
|
|
Cash flows from
operating activities: |
|
|
|
Net
Income (loss) |
$ |
71 |
|
|
$ |
(18 |
) |
Adjustments to reconcile net income (loss) to net cash provided by
(used in) operating activities: |
|
|
|
Depreciation and amortization |
|
36 |
|
|
|
105 |
|
Stock-based compensation expense |
|
29 |
|
|
|
76 |
|
Non-cash
interest expense |
|
9 |
|
|
|
27 |
|
Loss on
debt redemption |
|
2 |
|
|
|
9 |
|
Other |
|
3 |
|
|
|
4 |
|
Changes
in operating assets and liabilities: |
|
|
|
Accounts
receivable |
|
(157 |
) |
|
|
(460 |
) |
Inventories |
|
39 |
|
|
|
(43 |
) |
Prepayment and other receivables - related parties |
|
(16 |
) |
|
|
6 |
|
Prepaid
expenses and other assets |
|
(26 |
) |
|
|
(82 |
) |
Payables
to related parties |
|
70 |
|
|
|
61 |
|
Accounts
payable, accrued liabilities and other |
|
6 |
|
|
|
- |
|
Net cash provided by (used in) operating
activities |
$ |
66 |
|
|
$ |
(315 |
) |
|
|
|
|
Cash flows from
investing activities: |
|
|
|
Purchases
of property, plant and equipment |
|
(34 |
) |
|
|
(69 |
) |
Purchases
of available-for-sale securities |
|
- |
|
|
|
(221 |
) |
Proceeds
from maturity of available-for-sale securities |
|
85 |
|
|
|
221 |
|
Other |
|
- |
|
|
|
(2 |
) |
Net cash provided by (used in) investing
activities |
$ |
51 |
|
|
$ |
(71 |
) |
|
|
|
|
Cash flows from
financing activities: |
|
|
|
Proceeds
from borrowings, net |
|
28 |
|
|
|
70 |
|
Proceeds
from issuance of common stock under stock-based compensation equity
plans |
|
5 |
|
|
|
15 |
|
Repayments of long-term debt |
|
(28 |
) |
|
|
(70 |
) |
Other |
|
(3 |
) |
|
|
(14 |
) |
Net cash provided by financing activities |
$ |
2 |
|
|
$ |
1 |
|
Net increase (decrease)
in cash and cash equivalents |
|
119 |
|
|
|
(385 |
) |
Cash and cash equivalents at beginning of
period |
$ |
760 |
|
|
$ |
1,264 |
|
Cash and cash equivalents at end of period |
$ |
879 |
|
|
$ |
879 |
|
ADVANCED MICRO
DEVICES, INC. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SELECTED
CORPORATE DATA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Millions) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
Nine Months Ended |
|
Segment and Category Information |
|
September 30, 2017 |
|
|
July 1, 2017 |
|
|
September 24, 2016 |
|
|
|
September 30, 2017 |
|
|
September 24, 2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Computing and Graphics (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
819 |
|
|
|
$ |
659 |
|
|
|
$ |
472 |
|
|
|
|
$ |
2,071 |
|
|
|
$ |
1,367 |
|
|
Operating income (loss) |
|
$ |
70 |
|
|
|
$ |
7 |
|
|
|
$ |
(66 |
) |
|
|
|
$ |
62 |
|
|
|
$ |
(217 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Enterprise, Embedded and Semi-Custom (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
824 |
|
|
|
$ |
563 |
|
|
|
$ |
835 |
|
|
|
|
$ |
1,778 |
|
|
|
$ |
1,799 |
|
|
Operating income |
|
$ |
84 |
|
|
|
$ |
42 |
|
|
|
$ |
136 |
|
|
|
|
$ |
135 |
|
|
|
$ |
236 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All Other (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
|
- |
|
|
|
|
- |
|
|
|
|
- |
|
|
|
|
|
- |
|
|
|
|
- |
|
|
Operating loss |
|
$ |
(28 |
) |
|
|
$ |
(24 |
) |
|
|
$ |
(363 |
) |
|
|
|
$ |
(75 |
) |
|
|
|
(388 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
1,643 |
|
|
|
$ |
1,222 |
|
|
|
$ |
1,307 |
|
|
|
|
$ |
3,849 |
|
|
|
$ |
3,166 |
|
|
Operating income (loss) |
|
$ |
126 |
|
|
|
$ |
25 |
|
|
|
$ |
(293 |
) |
|
|
|
$ |
122 |
|
|
|
$ |
(369 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures (4) |
|
$ |
34 |
|
|
|
$ |
12 |
|
|
|
$ |
9 |
|
|
|
|
$ |
69 |
|
|
|
$ |
56 |
|
|
Adjusted EBITDA (5) |
|
$ |
191 |
|
|
|
$ |
84 |
|
|
|
$ |
103 |
|
|
|
|
$ |
303 |
|
|
|
$ |
117 |
|
|
Cash, cash equivalents and marketable securities |
|
$ |
879 |
|
|
|
$ |
844 |
|
|
|
$ |
1,258 |
|
|
|
|
$ |
879 |
|
|
|
$ |
1,258 |
|
|
Free cash flow (6) |
|
$ |
32 |
|
|
|
$ |
(94 |
) |
|
|
$ |
20 |
|
|
|
|
$ |
(384 |
) |
|
|
$ |
(154 |
) |
|
Total assets |
|
$ |
3,586 |
|
|
|
$ |
3,370 |
|
|
|
$ |
3,616 |
|
|
|
|
$ |
3,586 |
|
|
|
$ |
3,616 |
|
|
Total debt |
|
$ |
1,426 |
|
|
|
$ |
1,417 |
|
|
|
$ |
1,632 |
|
|
|
|
$ |
1,426 |
|
|
|
$ |
1,632 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See footnotes on the
next page |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1 |
) |
The Computing and Graphics segment primarily includes desktop
and notebook processors and chipsets, discrete graphics processing
units (GPUs) and professional graphics processors. The Company also
licenses portions of its intellectual property portfolio. |
(2 |
) |
The Enterprise, Embedded and Semi-Custom segment primarily
includes server and embedded processors, semi-custom System-on-Chip
(SoC) products, development services and technology for game
consoles. The Company also licenses portions of its intellectual
property portfolio. |
(3 |
) |
All Other category primarily includes certain expenses and
credits that are not allocated to any of the operating segments.
Also included in this category is stock-based compensation expense.
In addition, the Company also included a charge related to the
sixth amendment to the WSA with GF for the three and nine months
ended September 24, 2016 and restructuring and other special
charges, net for the nine months ended September 24, 2016. |
(4 |
) |
Starting in Q1 2017, the Company classifies production mask
sets as property, plant and equipment on its balance
sheet. |
(5 |
) |
Reconciliation of GAAP Operating Income (Loss) to
Adjusted EBITDA* |
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2017 |
July 1, 2017 |
September 24, 2016 |
|
September 30, 2017 |
September 24, 2016 |
|
GAAP operating income
(loss) |
$ |
126 |
|
$ |
25 |
|
$ |
(293 |
) |
|
$ |
122 |
|
$ |
(369 |
) |
|
Charge related to the
sixth amendment to the WSA with GF |
|
- |
|
|
- |
|
|
340 |
|
|
|
- |
|
|
340 |
|
|
Restructuring and other
special charges, net |
|
- |
|
|
- |
|
|
- |
|
|
|
- |
|
|
(10 |
) |
|
Stock-based
compensation |
|
29 |
|
|
24 |
|
|
23 |
|
|
|
76 |
|
|
57 |
|
|
Depreciation and
amortization |
|
36 |
|
|
35 |
|
|
33 |
|
|
|
105 |
|
|
99 |
|
|
Adjusted EBITDA |
$ |
191 |
|
$ |
84 |
|
$ |
103 |
|
|
$ |
303 |
|
$ |
117 |
|
|
|
|
|
|
|
|
|
(6 |
) |
Free cash flow
reconciliation** |
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2017 |
July 1, 2017 |
September 24, 2016 |
|
September 30, 2017 |
September 24, 2016 |
|
GAAP net cash provided
by (used in) operating activities |
$ |
66 |
|
$ |
(82 |
) |
$ |
29 |
|
|
$ |
(315 |
) |
$ |
(98 |
) |
|
Purchases of property,
plant and equipment |
|
(34 |
) |
|
(12 |
) |
|
(9 |
) |
|
|
(69 |
) |
|
(56 |
) |
|
Free cash flow |
$ |
32 |
|
$ |
(94 |
) |
$ |
20 |
|
|
$ |
(384 |
) |
$ |
(154 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* |
The Company presents “Adjusted EBITDA” as a supplemental
measure of its performance. Adjusted EBITDA for the Company is
determined by adjusting operating income (loss) for depreciation
and amortization and stock-based compensation expense. In addition,
the Company excluded a charge related to the sixth amendment to the
WSA with GF for the three and nine months ended September 24, 2016
and restructuring and other special charges, net for the nine
months ended September 24, 2016. 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 operating
income (loss) 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 as well as interest income and expense and
income taxes that can affect cash flows. |
** |
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 (used in) operating
activities for capital expenditures. 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. |
|
The Company has provided reconciliations within the earnings
press release of these non-GAAP financial measures to the most
directly comparable GAAP financial measures. |
|
|
|
|
|
|
|
|
Media ContactDrew
Prairie512-602-4425drew.prairie@amd.com
Investor ContactLaura
Graves408-749-5467laura.graves@amd.com
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