AMD Reports Third Quarter 2019 Financial Results
October 29 2019 - 4:15PM
AMD (NASDAQ:AMD) today announced revenue for the third quarter of
2019 of $1.80 billion, operating income of $186 million, net income
of $120 million and diluted earnings per share of $0.11. On a
non-GAAP(*) basis, operating income was $240 million, net income
was $219 million and diluted earnings per share was $0.18.
GAAP Quarterly Financial
Results
|
Q3 2019 |
Q3 2018 |
Y/Y |
Q2 2019 |
Q/Q |
Revenue ($B) |
$1.80 |
$1.65 |
Up 9% |
$1.53 |
Up 18% |
Gross margin |
43% |
40% |
Up 3 pp |
41% |
Up 2 pp |
Operating expense ($M) |
$591 |
$511 |
Up $80 |
$562 |
Up $29 |
Operating income ($M) |
$186 |
$150 |
Up $36 |
$59 |
Up $127 |
Net income ($M) |
$120 |
$102 |
Up $18 |
$35 |
Up $85 |
Earnings per share |
$0.11 |
$0.09 |
Up $0.02 |
$0.03 |
Up $0.08 |
Non-GAAP(*) Quarterly Financial
Results
|
Q3 2019 |
Q3 2018 |
Y/Y |
Q2 2019 |
Q/Q |
Revenue ($B) |
$1.80 |
$1.65 |
Up 9% |
$1.53 |
Up 18% |
Gross margin |
43% |
40% |
Up 3 pp |
41% |
Up 2 pp |
Operating expense ($M) |
$539 |
$476 |
Up $63 |
$512 |
Up $27 |
Operating income ($M) |
$240 |
$186 |
Up $54 |
$111 |
Up $129 |
Net income ($M) |
$219 |
$150 |
Up $69 |
$92 |
Up $127 |
Earnings per share |
$0.18 |
$0.13 |
Up $0.05 |
$0.08 |
Up $0.10 |
“Our first full quarter of 7nm Ryzen, Radeon and EPYC processor
sales drove our highest quarterly revenue since 2005, our highest
quarterly gross margin since 2012 and a significant increase in net
income year-over-year,” said Dr. Lisa Su, AMD president and CEO. “I
am extremely pleased with our progress as we have the strongest
product portfolio in our history, significant customer momentum and
a leadership product roadmap for 2020 and beyond.”
Q3 2019 Results
- Revenue was $1.80 billion, up 9 percent year-over-year and 18
percent quarter-over-quarter due to higher revenue in the Computing
and Graphics segment, partially offset by lower revenue in the
Enterprise, Embedded and Semi-Custom segment.
- Gross margin was 43 percent, up 3 percentage points
year-over-year and 2 percentage points quarter-over-quarter,
primarily driven by increased RyzenTM and EPYCTM processor
sales.
- Operating income was $186 million compared to $150 million a
year ago and $59 million in the prior quarter. Non-GAAP operating
income was $240 million compared to $186 million a year ago and
$111 million in the prior quarter. The year-over-year and
sequential increases were primarily due to higher revenue in the
Computing and Graphics segment.
- Net income was $120 million compared to $102 million a year ago
and $35 million in the prior quarter. Non-GAAP net income was $219
million compared to $150 million a year ago and $92 million in the
prior quarter.
- Diluted earnings per share was $0.11 compared to $0.09 a year
ago and $0.03 in the prior quarter. Non-GAAP diluted earnings per
share was $0.18 compared to $0.13 a year ago and $0.08 in the prior
quarter.
- Cash, cash equivalents and marketable securities were $1.2
billion at the end of the quarter.
Quarterly Financial Segment Summary
- Computing and Graphics segment revenue was $1.28 billion, up 36
percent year-over-year and sequentially. Higher revenue was
primarily driven by increased Ryzen client processor sales.
- Client processor average selling price (ASP) increased
year-over-year primarily driven by Ryzen desktop processor sales
and increased quarter-over-quarter driven by both Ryzen desktop and
mobile processor sales.
- GPU ASP increased year-over-year driven by higher channel sales
and decreased quarter-over-quarter due to a higher proportion of
mobile sales.
- Operating income was $179 million compared to $100 million a
year ago and $22 million in the prior quarter. The year-over-year
and quarter-over-quarter increase was primarily due to higher
revenue.
- Enterprise, Embedded and Semi-Custom segment revenue was $525
million, down 27 percent year-over-year and 11 percent
sequentially. The year-over-year and quarter-over-quarter decreases
were primarily due to lower semi-custom product revenue, partially
offset by higher EPYC processor sales.
- Operating income was $61 million, compared to $86 million a
year ago and $89 million in the prior quarter. The year-over-year
and quarter-over-quarter decreases were due to lower revenue and
higher operating expenses.
- All Other operating loss was $54 million compared to $36
million a year ago and $52 million in the prior quarter.
Q3 2019 PR Highlights
- AMD launched the 2nd Gen AMD EPYC™ processors with
record-setting performance across multiple enterprise, cloud and
high performance computing workloads, alongside an expansive,
global ecosystem of data center partners and customers.
- Google announced deployment of 2nd Gen AMD EPYC processors in
its internal infrastructure and that it will offer new
general-purpose machines powered by the processors on Google Cloud
Compute Engine.
- Twitter announced that 2nd Gen AMD EPYC processor deployments
across its data center infrastructure will lower total cost of
ownership by 25 percent while reducing the environmental impact of
its data centers.
- Cray announced that UK Research and Innovation will leverage
Cray’s Shasta supercomputer powered by 2nd Gen AMD EPYC processors
for its new ARCHER2 system. Expected to be the UK’s most powerful
supercomputer, it will power research across multiple disciplines,
including oil and gas, sustainability and health. Cray also
announced that the Air Force Weather Agency will use a Cray Shasta
system with 2nd Gen AMD EPYC processors to provide comprehensive
terrestrial and space weather information to the U.S. Air Force and
Army.
- Dell Technologies, HPE, Lenovo and others announced support for
over a dozen new 2nd Gen AMD EPYC processor-powered platforms for
enterprise, HPC and cloud customers.
- IBM Cloud and Nokia detailed the performance advantages of 2nd
Gen AMD EPYC processors for their cloud and 5G customers, including
cloud security improvements, better memory bandwidth for big data
and analytics workloads, core scaling and significantly better
packet throughput.
- Microsoft announced that its new 15-inch Microsoft Surface
Laptop 3 will be powered by an AMD Ryzen™ mobile processor. The
result of a multi-year co-engineering effort, the system combines
the custom AMD Ryzen™ Microsoft Surface Edition processor with an
optimized Windows operating system software stack to create an
ultra-powerful, ultra-thin notebook with all-day battery life.
- Leading PC companies expanded their AMD Ryzen processor-powered
offerings with new commercial and consumer offerings, including:
- HP and Lenovo announced they will offer new desktop business
PCs featuring the recently launched AMD Ryzen™ PRO 3000 Series and
AMD Ryzen™ PRO processors with Radeon™ Vega Graphics.
- AMD also launched the AMD Athlon™ PRO processors with Radeon
Vega Graphics. The new processors deliver powerful,
energy-efficient performance and commercial-grade reliability.
- HP unveiled its first AMD-powered gaming laptop, the Pavilion
Gaming 15 Laptop, featuring the 2nd Gen AMD Ryzen™ 7 mobile
processors. HP also announced the Pavilion Gaming Desktop, offering
2nd and 3rd Gen AMD Ryzen™ 7 desktop processors.
- Lenovo announced that the new consumer-focused IdeaCentre A540
and IdeaPad S540 will offer high-end Ryzen CPU options.
- AMD Radeon™ graphics products based on the groundbreaking new
RDNA gaming architecture bring powerful performance and advanced
features:
- AMD announced the AMD Radeon™ RX 5500 Series graphics products,
bringing the RDNA architecture to desktop PCs with the Radeon™ RX
5500 graphics card and to notebook PCs with the Radeon™ RX 5500M
GPU. Systems will be available from top OEMs including Acer, HP,
Lenovo and MSI beginning this November.
- AIB partners including Sapphire, MSI, Asus, PowerColor,
Gigabyte and XFX released new Radeon™ RX 5700 series graphics cards
with incredible designs for multiple form factors.
- Microsoft began the public preview for its Project xCloud
cloud-based game streaming service, which is powered by the same
custom-made SoC used in Xbox One S consoles to deliver a
high-quality mobile game streaming experience to players around the
world.
- AMD was named one of Fast Company’s Best Places to Work for
Innovators for 2019, highlighting its commitment to cultivating a
workplace where employees can do their best work and push the
boundaries of high-performance computing.
Current Outlook
AMD’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 2019, AMD expects revenue to be
approximately $2.1 billion, plus or minus $50 million, an increase
of approximately 48 percent year-over-year and approximately 17
percent sequentially. The year-over-year and sequential increases
are expected to be driven by an increase in Ryzen, EPYC and Radeon
product sales. AMD expects non-GAAP gross margin to be
approximately 44 percent in the fourth quarter of 2019.
AMD Teleconference
AMD will hold a conference call for the financial community at
2:30 p.m. PT (5:30 p.m. ET) today to discuss its third quarter 2019
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 FINANCIAL
MEASURES |
(In millions, except per
share data) |
|
Three Months Ended |
|
|
September 28, 2019 |
|
June 29, 2019 |
|
September 29, 2018 |
GAAP gross margin |
|
$ |
777 |
|
|
$ |
621 |
|
|
$ |
661 |
|
GAAP gross margin
% |
|
43 |
% |
|
41 |
% |
|
40 |
% |
Stock-based compensation |
|
2 |
|
|
2 |
|
|
1 |
|
Non-GAAP gross
margin |
|
$ |
779 |
|
|
$ |
623 |
|
|
$ |
662 |
|
Non-GAAP gross margin
% |
|
43 |
% |
|
41 |
% |
|
40 |
% |
|
|
|
|
|
|
|
GAAP operating
expenses |
|
$ |
591 |
|
|
$ |
562 |
|
|
$ |
511 |
|
Stock-based compensation |
|
52 |
|
|
43 |
|
|
35 |
|
Loss contingency on legal matter |
|
— |
|
|
7 |
|
|
— |
|
Non-GAAP operating
expenses |
|
$ |
539 |
|
|
$ |
512 |
|
|
$ |
476 |
|
|
|
|
|
|
|
|
GAAP operating
income |
|
$ |
186 |
|
|
$ |
59 |
|
|
$ |
150 |
|
Stock-based compensation |
|
54 |
|
|
45 |
|
|
36 |
|
Loss contingency on legal matter |
|
— |
|
|
7 |
|
|
— |
|
Non-GAAP operating
income |
|
$ |
240 |
|
|
$ |
111 |
|
|
$ |
186 |
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
September 28, 2019 |
|
June 29, 2019 |
|
September 29, 2018 |
GAAP net income / earnings per share |
|
$ |
120 |
|
|
$ |
0.11 |
|
|
$ |
35 |
|
|
$ |
0.03 |
|
|
$ |
102 |
|
|
$ |
0.09 |
|
Loss on debt redemption/conversion |
|
40 |
|
|
0.03 |
|
|
— |
|
|
— |
|
|
6 |
|
|
— |
|
Non-cash interest expense related to convertible debt |
|
6 |
|
|
— |
|
|
6 |
|
|
— |
|
|
6 |
|
|
0.01 |
|
Stock-based compensation |
|
54 |
|
|
0.04 |
|
|
45 |
|
|
0.04 |
|
|
36 |
|
|
0.03 |
|
Equity income in investee |
|
(1 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Loss contingency on legal matter |
|
— |
|
|
— |
|
|
7 |
|
|
0.01 |
|
|
— |
|
|
— |
|
Provision (benefit) for income taxes |
|
— |
|
|
— |
|
|
(1 |
) |
|
— |
|
|
— |
|
|
— |
|
Non-GAAP net income /
earnings per share (1) |
|
$ |
219 |
|
|
$ |
0.18 |
|
|
$ |
92 |
|
|
$ |
0.08 |
|
|
$ |
150 |
|
|
$ |
0.13 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used and net
income adjustment in earnings per share calculation |
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in per share
calculation (GAAP) |
|
1,117 |
|
|
1,109 |
|
|
1,076 |
|
Interest expense add-back to
GAAP net income |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
Shares used in per share calculation (Non-GAAP) |
|
1,212 |
|
|
1,210 |
|
|
1,177 |
|
Interest expense add-back to
Non-GAAP net income |
|
$ |
4 |
|
|
$ |
5 |
|
|
$ |
5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) For the
three months ended September 28, 2019, Non-GAAP diluted EPS
calculation includes the 95 million shares
related to the Company’s 2026 Convertible Notes and the associated
$4 million interest expense add-back to net income
under the "if converted" method.
For the three months ended June 29, 2019 and
September 29, 2018, Non-GAAP diluted EPS calculation includes
the 100.6 million shares related to the
Company’s 2026 Convertible Notes and the associated $5 million
interest expense add-back to net income under
the "if converted" method. |
About AMD
For 50 years, AMD has driven innovation in
high-performance computing, graphics and visualization technologies
– the building blocks for gaming, immersive platforms and the data
center. 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 Statement
This document contains forward-looking
statements concerning Advanced Micro Devices, Inc. (AMD) such as
AMD's expectations regarding its long-term product roadmap for 2020
and beyond; the features, functionality, performance, availability,
timing and expected benefits of AMD products; and AMD’s expected
fourth quarter of 2019 and fiscal 2019 financial outlook, including
revenue, as well as the expected drivers of such revenue, and
non-GAAP gross margin, 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; the ability of GLOBALFOUNDRIES Inc.
to satisfy AMD’s manufacturing requirements; the ability of third
party manufacturers to manufacture AMD's products on a timely basis
in sufficient quantities and using competitive technologies;
expected manufacturing yields for AMD’s products; AMD's 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; AMD's ability to
generate sufficient revenue and operating cash flow or obtain
external financing for research and development or other strategic
investments; the loss of a significant customer; AMD's ability to
generate revenue from its semi-custom SoC products; global economic
uncertainty; political, legal and economic risks and natural
disasters; potential security vulnerabilities; potential IT
outages, data loss, data breaches and cyber-attacks; quarterly and
seasonal sales patterns; AMD's ability to generate sufficient cash
to service its debt obligations or meet its working capital
requirements; AMD's indebtedness; the restrictions imposed by
agreements governing AMD’s notes and the secured credit facility;
the competitive markets in which AMD’s products are sold; the
potential dilutive effect if the 2.125% Convertible Senior Notes
due 2026 are converted; uncertainties involving the ordering and
shipment of AMD’s products; the market conditions of the industries
in which AMD products are sold; 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 the
design, manufacture and supply of motherboards, software and other
computer platform components; AMD's reliance on Microsoft
Corporation 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; future
impairments of goodwill and technology license purchases; AMD’s
ability to attract and retain qualified personnel; AMD's ability to
repurchase its outstanding debt in the event of a change of
control; the cyclical nature of the semiconductor industry; the
impact of acquisitions, divestitures, joint ventures and/or
investments on AMD's business; the impact of modification or
interruption of AMD’s internal business processes and information
systems; the availability of essential equipment, materials or
manufacturing processes; compatibility of AMD’s products with some
or all industry-standard software and hardware; costs related to
defective products; the efficiency of AMD's supply chain; AMD's
ability to rely on third party supply-chain logistics functions;
AMD’s stock price volatility; worldwide political conditions;
unfavorable currency exchange rate fluctuations; AMD’s ability to
effectively control the sales of its products on the gray market;
AMD's ability to adequately protect its technology or other
intellectual property; current and future claims and litigation;
potential tax liabilities; and environmental laws, conflict
minerals-related provisions and other laws or regulations.
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 June 29, 2019.
* |
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 expense, non-GAAP operating income, non-GAAP net income
and non-GAAP earnings per share. These non-GAAP financial measures
reflect certain adjustments as presented in the tables in this
earnings press release. AMD has 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. |
AMD, the AMD Arrow logo, EPYC, Radeon, Ryzen, Athlon 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)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 28, 2019 |
|
June 29, 2019 |
|
September 29, 2018 |
|
September 28, 2019 |
|
September 29, 2018 |
Net revenue |
|
$ |
1,801 |
|
|
$ |
1,531 |
|
|
$ |
1,653 |
|
|
$ |
4,604 |
|
|
$ |
5,056 |
|
Cost of sales |
|
1,024 |
|
|
910 |
|
|
992 |
|
|
2,685 |
|
|
3,146 |
|
Gross margin |
|
777 |
|
|
621 |
|
|
661 |
|
|
1,919 |
|
|
1,910 |
|
Gross margin % |
|
43 |
% |
|
41 |
% |
|
40 |
% |
|
42 |
% |
|
38 |
% |
Research and development |
|
406 |
|
|
373 |
|
|
363 |
|
|
1,152 |
|
|
1,063 |
|
Marketing, general and administrative |
|
185 |
|
|
189 |
|
|
148 |
|
|
544 |
|
|
424 |
|
Licensing gain |
|
— |
|
|
— |
|
|
— |
|
|
(60 |
) |
|
— |
|
Operating income |
|
186 |
|
|
59 |
|
|
150 |
|
|
283 |
|
|
423 |
|
Interest expense |
|
(24 |
) |
|
(25 |
) |
|
(30 |
) |
|
(76 |
) |
|
(92 |
) |
Other income (expense), net |
|
(36 |
) |
|
3 |
|
|
(6 |
) |
|
(40 |
) |
|
(4 |
) |
Income before income taxes and
equity loss |
|
126 |
|
|
37 |
|
|
114 |
|
|
167 |
|
|
327 |
|
Provision (benefit) for income taxes |
|
7 |
|
|
2 |
|
|
12 |
|
|
(4 |
) |
|
26 |
|
Equity income (loss) in investee |
|
1 |
|
|
— |
|
|
— |
|
|
— |
|
|
(2 |
) |
Net Income |
|
$ |
120 |
|
|
$ |
35 |
|
|
$ |
102 |
|
|
$ |
171 |
|
|
$ |
299 |
|
Earnings per share |
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.11 |
|
|
$ |
0.03 |
|
|
$ |
0.10 |
|
|
$ |
0.16 |
|
|
$ |
0.31 |
|
Diluted |
|
$ |
0.11 |
|
|
$ |
0.03 |
|
|
$ |
0.09 |
|
|
$ |
0.15 |
|
|
$ |
0.28 |
|
Shares used in per share
calculation |
|
|
|
|
|
|
|
|
|
|
Basic |
|
1,097 |
|
|
1,084 |
|
|
987 |
|
|
1,075 |
|
|
976 |
|
Diluted |
|
1,117 |
|
|
1,109 |
|
|
1,076 |
|
|
1,107 |
|
|
1,058 |
|
ADVANCED MICRO DEVICES, INC.CONDENSED
CONSOLIDATED BALANCE SHEETS(Millions)
|
|
September 28, 2019 (1) |
|
December 29,2018 (2) |
Assets |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
1,156 |
|
|
$ |
1,078 |
|
Marketable securities |
|
53 |
|
|
78 |
|
Accounts receivable, net |
|
1,393 |
|
|
1,235 |
|
Inventories, net |
|
1,040 |
|
|
845 |
|
Prepayment and receivables - related parties |
|
17 |
|
|
34 |
|
Prepaid expenses and other current assets |
|
253 |
|
|
270 |
|
Total current assets |
|
3,912 |
|
|
3,540 |
|
Property and equipment,
net |
|
453 |
|
|
348 |
|
Operating lease right-of use
assets |
|
205 |
|
|
— |
|
Goodwill |
|
289 |
|
|
289 |
|
Investment: equity method |
|
59 |
|
|
58 |
|
Other assets |
|
335 |
|
|
321 |
|
Total
Assets |
|
$ |
5,253 |
|
|
$ |
4,556 |
|
|
|
|
|
|
Liabilities and
Stockholders' Equity |
|
|
|
|
Current
liabilities: |
|
|
|
|
Short-term debt, net |
|
$ |
— |
|
|
$ |
136 |
|
Accounts payable |
|
763 |
|
|
834 |
|
Payables to related parties |
|
215 |
|
|
207 |
|
Accrued liabilities |
|
837 |
|
|
783 |
|
Other current liabilities |
|
49 |
|
|
24 |
|
Total current liabilities |
|
1,864 |
|
|
1,984 |
|
Long-term debt, net |
|
872 |
|
|
1,114 |
|
Long-term operating lease
liabilities |
|
201 |
|
|
— |
|
Other long-term
liabilities |
|
140 |
|
|
192 |
|
|
|
|
|
|
Stockholders' equity: |
|
|
|
|
Capital stock: |
|
|
|
|
Common stock, par value |
|
11 |
|
|
10 |
|
Additional paid-in capital |
|
9,490 |
|
|
8,750 |
|
Treasury stock, at cost |
|
(53 |
) |
|
(50 |
) |
Accumulated deficit |
|
(7,265 |
) |
|
(7,436 |
) |
Accumulated other comprehensive loss |
|
(7 |
) |
|
(8 |
) |
Total Stockholders' equity |
|
$ |
2,176 |
|
|
$ |
1,266 |
|
Total Liabilities and
Stockholders' Equity |
|
$ |
5,253 |
|
|
$ |
4,556 |
|
|
|
|
|
|
(1) During the first
quarter of 2019, the Company adopted the new lease accounting
standard, ASC 842, Leases, which resulted in an increase to
assets and liabilities for leases primarily related to office
buildings. The adoption of this standard had no impact
to the Company's results of operations or statement of cash
flows. |
(2) During the second
quarter of 2019, GLOBALFOUNDRIES Inc. (GF) ceased being a related
party of the Company. All prior period GF related party
balances have been reclassified to conform to the current period
presentation. |
ADVANCED MICRO DEVICES, INC.SELECTED
CASH FLOW INFORMATION(Millions)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 28, 2019 |
|
September 28, 2019 |
Net cash provided by
(used in) |
|
|
|
|
Operating activities |
|
$ |
234 |
|
|
$ |
51 |
|
Investing activities |
|
$ |
57 |
|
|
$ |
(123 |
) |
Financing activities |
|
$ |
(98 |
) |
|
$ |
150 |
|
SELECTED CORPORATE
DATA(Millions)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 28, 2019 |
|
June 29, 2019 |
|
September 29, 2018 |
|
September 28, 2019 |
|
September 29, 2018 |
Segment and Category
Information |
|
|
|
|
|
|
|
|
|
|
Computing and Graphics (1) |
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
1,276 |
|
|
$ |
940 |
|
|
$ |
938 |
|
|
$ |
3,047 |
|
|
$ |
3,139 |
|
Operating income |
|
$ |
179 |
|
|
$ |
22 |
|
|
$ |
100 |
|
|
$ |
217 |
|
|
$ |
355 |
|
Enterprise, Embedded and Semi-Custom (2) |
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
525 |
|
|
$ |
591 |
|
|
$ |
715 |
|
|
$ |
1,557 |
|
|
$ |
1,917 |
|
Operating income |
|
$ |
61 |
|
|
$ |
89 |
|
|
$ |
86 |
|
|
$ |
218 |
|
|
$ |
169 |
|
All Other (3) |
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
Operating loss |
|
$ |
(54 |
) |
|
$ |
(52 |
) |
|
$ |
(36 |
) |
|
$ |
(152 |
) |
|
$ |
(101 |
) |
Total |
|
|
|
|
|
|
|
|
|
|
Net revenue |
|
$ |
1,801 |
|
|
$ |
1,531 |
|
|
$ |
1,653 |
|
|
$ |
4,604 |
|
|
$ |
5,056 |
|
Operating income |
|
$ |
186 |
|
|
$ |
59 |
|
|
$ |
150 |
|
|
$ |
283 |
|
|
$ |
423 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
Data |
|
|
|
|
|
|
|
|
|
|
Capital expenditures |
|
$ |
55 |
|
|
$ |
58 |
|
|
$ |
33 |
|
|
$ |
175 |
|
|
$ |
122 |
|
Adjusted EBITDA (4) |
|
$ |
300 |
|
|
$ |
163 |
|
|
$ |
227 |
|
|
$ |
593 |
|
|
$ |
651 |
|
Cash, cash equivalents and marketable securities |
|
$ |
1,209 |
|
|
$ |
1,128 |
|
|
$ |
1,056 |
|
|
$ |
1,209 |
|
|
$ |
1,056 |
|
Free cash flow (5) |
|
$ |
179 |
|
|
$ |
(28 |
) |
|
$ |
44 |
|
|
$ |
(124 |
) |
|
$ |
(208 |
) |
Total assets |
|
$ |
5,253 |
|
|
$ |
5,102 |
|
|
$ |
4,347 |
|
|
$ |
5,253 |
|
|
$ |
4,347 |
|
Total debt |
|
$ |
872 |
|
|
$ |
1,031 |
|
|
$ |
1,303 |
|
|
$ |
872 |
|
|
$ |
1,303 |
|
(1) The Computing and Graphics segment primarily includes desktop
and notebook processors and chipsets, discrete and integrated
graphics processing units (GPUs), data center and
professional GPUs, and development services. 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. |
|
|
|
|
|
|
|
|
|
|
|
(4)
Reconciliation of GAAP Net Income to Adjusted
EBITDA* |
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 28, 2019 |
|
June 29, 2019 |
|
September 29, 2018 |
|
September 28, 2019 |
|
September 29, 2018 |
GAAP net income |
|
$ |
120 |
|
|
$ |
35 |
|
|
$ |
102 |
|
|
$ |
171 |
|
|
$ |
299 |
|
Interest expense |
|
24 |
|
|
25 |
|
|
30 |
|
|
76 |
|
|
92 |
|
Other (income) expense, net |
|
36 |
|
|
(3 |
) |
|
6 |
|
|
40 |
|
|
4 |
|
Provision (benefit) for income taxes |
|
7 |
|
|
2 |
|
|
12 |
|
|
(4 |
) |
|
26 |
|
Equity (income) loss in investee |
|
(1 |
) |
|
— |
|
|
— |
|
|
— |
|
|
2 |
|
Stock-based compensation |
|
54 |
|
|
45 |
|
|
36 |
|
|
140 |
|
|
101 |
|
Depreciation and amortization |
|
60 |
|
|
52 |
|
|
41 |
|
|
158 |
|
|
127 |
|
Loss contingency on legal matter |
|
— |
|
|
7 |
|
|
— |
|
|
12 |
|
|
— |
|
Adjusted EBITDA |
|
$ |
300 |
|
|
$ |
163 |
|
|
$ |
227 |
|
|
$ |
593 |
|
|
$ |
651 |
|
(5) Free Cash Flow
Reconciliation** |
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 28, 2019 |
|
June 29, 2019 |
|
September 29, 2018 |
|
September 28, 2019 |
|
September 29, 2018 |
GAAP net cash provided by
(used in) operating activities |
|
$ |
234 |
|
|
$ |
30 |
|
|
$ |
77 |
|
|
$ |
51 |
|
|
$ |
(86 |
) |
Purchases of property and equipment |
|
(55 |
) |
|
(58 |
) |
|
(33 |
) |
|
(175 |
) |
|
(122 |
) |
Free cash flow |
|
$ |
179 |
|
|
$ |
(28 |
) |
|
$ |
44 |
|
|
$ |
(124 |
) |
|
$ |
(208 |
) |
* |
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, provision (benefit) for income taxes, equity income
(loss) on investee, stock-based compensation, and depreciation and
amortization expense. In addition, the Company also included a loss
contingency on legal matter in the three months ended June 29, 2019
and the nine months ended September 28, 2019. 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. |
|
|
** |
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. All periods
presented conform to the current period presentation. |
|
|
|
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 Contact:
Drew PrairieAMD
Communications512-602-4425drew.prairie@amd.com
Investor Contact:Laura
GravesAMD Investor
Relations408-749-5467laura.graves@amd.com
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