AMD Advanced Micro Devices : Financial TablesPDF XLSX Q3 2025

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Millions except per share amounts and percentages) (Unaudited)

Three Months Ended Nine Months Ended

September 27, June 28, September 28, September 27, September 28, 2025 2025 2024

2025 2024

Net revenue	$ 9,246	$ 7,685	$ 6,819		$ 24,369	$ 18,127
Cost of sales	4,206	4,366	3,167		12,023	8,590
Amortization of acquisition-related intangibles	260	260	233		771	694
Total cost of sales	4,466	4,626	3,400		12,794	9,284
Gross profit	4,780	3,059	3,419		11,575	8,843
Gross margin	52%	40%	50%		47%	49%
Research and development	2,139	1,894	1,636		5,761	4,744
Marketing, general and administrative	1,069	991	707		2,946	1,954
Amortization of acquisition-related intangibles	302	308	352		926	1,116
Total operating expenses	3,510	3,193	2,695		9,633	7,814
Operating income (loss)	1,270	(134)	724		1,942	1,029
Interest expense	(37)	(38)	(23)		(95)	(73)
Other income (expense), net	82	98	36		219	144
Income from continuing operations before income taxes and equity income	1,315	(74)	737		2,066	1,100
Income tax provision (benefit)	153	(834)	(27)		(558)	(38)
Equity income in investee	10	8	7		25	21
Income from continuing operations, net of tax	1,172	768	771		2,649	1,159
Income from discontinued operations, net of tax	71	104	-		175	-
Net income	$ 1,243	$ 872	$ 771		$ 2,824	$ 1,159

Earnings per share:

Earnings from continuing operations - basic	$ 0.72	$ 0.47	$ 0.48		$ 1.63	$ 0.72
Earnings from discontinued operations - basic	$ 0.04	$ 0.07	$ -		$ 0.11	$ -
Basic earnings per share	$ 0.76	$ 0.54	$ 0.48		$ 1.74	$ 0.72
Earnings from continuing operations - diluted	$ 0.71	$ 0.47	$ 0.47		$ 1.62	$ 0.71
Earnings from discontinued operations - diluted	$ 0.04	$ 0.07	$ -		$ 0.11	$ -
Diluted earnings per share	$ 0.75	$ 0.54	$ 0.47		$ 1.73	$ 0.71
Shares used in per share calculation
Basic	1,626	1,623	1,620	1,623		1,619
Diluted	1,641	1,630	1,636	1,632		1,638

CONDENSED CONSOLIDATED BALANCE SHEETS (Millions) Current assets: ASSETS September 27, 2025

(Unaudited)

December 28, 2024

Cash and cash equivalents	$	4,808		$ 3,787
Short-term investments		2,435		1,345
Accounts receivable, net		6,201		6,192
Inventories		7,313		5,734
Assets held for sale		3,990		-
Prepaid expenses and other current assets		2,253		1,991
Total current assets		27,000		19,049
Property and equipment, net		2,205		1,802
Goodwill		25,083		24,839
Acquisition-related intangibles, net		17,250		18,930
Deferred tax assets		633		688
Other non-current assets		4,720		3,918
Total Assets	$	76,891		$ 69,226

LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities:

Accounts payable	$	3,483		$	2,466
Accrued liabilities		5,112			4,260
Current portion of long-term debt, net		873			-
Liabilities held for sale		1,908			-
Other current liabilities		324			555
Total current liabilities		11,700			7,281
Long-term debt		2,347			1,721
Long-term operating lease liabilities		650			491
Deferred tax liabilities		326			349
Other long-term liabilities		1,078			1,816
Stockholders' equity: Capital stock: Common stock, par value $0.01		17			17
Additional paid-in capital		62,657			61,362
Treasury stock, at cost		(7,059)			(6,106)
Retained earnings		5,188			2,364
Accumulated other comprehensive loss		(13)			(69)
Total stockholders' equity		60,790			57,568
Total Liabilities and Stockholders' Equity	$	76,891		$	69,226

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Millions) (Unaudited) Three Months Ended Nine Months Ended

	September 27,	September 28,		September 27,	September 28,
	2025	2024		2025	2024
Cash flows from operating activities:
Net income	$ 1,243	$ 771		$ 2,824	$ 1,159
Income from discontinued operations, net of tax Adjustments to reconcile net income to net cash provided by operating activities:	(71)	-		(175)	-
Depreciation and amortization	192	171		556	499
Amortization of acquisition-related intangibles	562	585		1,697	1,810
Stock-based compensation	419	351		1,152	1,068
Deferred income taxes	218	(607)		18	(863)
Release of reserves for uncertain tax positions	-	-		(853)	-
Inventory loss at (recovery from) contract manufacturer	(67)	-		(67)	65
Other	-	17		29	32
Changes in operating assets and liabilities:
Accounts receivable, net	(1,085)	(2,213)		(7)	(1,961)
Inventories	(636)	(386)		(1,579)	(1,096)
Prepaid expenses and current assets	118	703		(259)	(171)
Accounts payable	451	873		998	574
Accrued and other liabilities	444	363		(145)	626
Net cash provided by operating activities of continuing operations	1,788	628		4,189	1,742
Net cash provided by operating activities of discontinued operations	371	-		920	-
Net cash flows provided by operations	2,159	628		5,109	1,742
Cash flows from investing activities:
Purchases of property and equipment	(258)	(132)		(752)	(428)
Purchases of short-term investments	(1,314)	(142)		(2,110)	(707)
Proceeds from maturity of short-term investments	299	149		982	1,351
Proceeds from sale of short-term investments	18	589		66	591
Purchases of strategic investments	(74)	(37)		(432)	(131)
Acquisitions, net of cash acquired	-	(548)		(1,716)	(548)
Other	-	(17)		-	(15)
Net cash (used in) provided by investing activities of continuing operations	(1,329)	(138)		(3,962)	113
Net cash (used in) investing activities of discontinued operations	(8)	-		(30)	-
Net cash flows (used in) provided by investing activities	(1,337)	(138)		(3,992)	113
Cash flows from financing activities:
Proceeds from debt and commercial paper issuance, net of issuance costs	-	-		2,441	-
Repayment of debt and commercial paper	-	-		(950)	(750)
Proceeds from sales of common stock through employee equity plans	10	4		169	152
Repurchases of common stock	(89)	(250)		(1,316)	(606)
Stock repurchases for tax withholding on employee equity plans	(371)	(460)		(447)	(686)
Other	-	-		-	(1)
Net cash (used in) provided by financing activities of continuing operations	(450)	(706)		(103)	(1,891)
Net (decrease) increase in cash, cash equivalents and restricted cash	372	(216)		1,014	(36)
Cash, cash equivalents and restricted cash at beginning of period	4,453	4,113		3,811	3,933
Cash, cash equivalents and restricted cash at end of period	$ 4,825	$ 3,897		$ 4,825	$ 3,897
Reconciliation of cash, cash equivalents and restricted cash Cash and cash equivalents	$ 4,808	$ 3,897		$ 4,808	$ 3,897
Restricted cash included in Prepaid expenses and other current assets	17	-		17	-
Cash, cash equivalents and restricted cash at end of period	$ 4,825	$ 3,897		$ 4,825	$ 3,897

SELECTED CORPORATE DATA (Millions) (Unaudited)

Three Months Ended Nine Months Ended

Segment and Disaggregated Revenue Information (1)

Net Revenue:

September 27, 2025 June 28, 2025 September 28, 2024 September 27, 2025 September 28, 2024

Data Center Segment	$ 4,341	$ 3,240	$ 3,549		$ 11,255	$ 8,720
Client and Gaming Segment
Client	2,750	2,499	1,881		7,543	4,741
Gaming	1,298	1,122	462		3,067	2,032
Total Client and Gaming	4,048	3,621	2,343		10,610	6,773
Embedded Segment	857	824	927		2,504	2,634
Total net revenue	$ 9,246	$ 7,685	$ 6,819		$ 24,369	$ 18,127
Operating Income (Loss):
Data Center Segment	$ 1,074	$ (155)	$ 1,041		$ 1,851	$ 2,325
Client and Gaming Segment	867	767	288		2,130	691
Embedded Segment	283	275	372		886	1,059
All other	(954)	(1,021)	(977)		(2,925)	(3,046)
Total operating income (loss)	$ 1,270	$ (134)	$ 724		$ 1,942	$ 1,029
Other Data
Capital expenditures	$ 258	$ 282	$ 132		$ 752	$ 428
Adjusted EBITDA (2)	$ 2,431	$ 1,088	$ 1,887		$ 5,473	$ 4,612
Cash, cash equivalents and short-term investments	$ 7,243	$ 5,867	$ 4,544		$ 7,243	$ 4,544
Free cash flow (3)	$ 1,530	$ 1,180	$ 496		$ 3,437	$ 1,314
Total assets	$ 76,891	$ 74,820	$ 69,636		$ 76,891	$ 69,636
Total debt	$ 3,220	$ 3,218	$ 1,720		$ 3,220	$ 1,720

See footnotes on the next page

(1) The Company operates as three operating segments, Data Center, Client and Gaming, and Embedded segments.

The Data Center segment primarily includes Artificial Intelligence (AI) accelerators, server microprocessors (CPUs), graphics processing units (GPUs), accelerated processing units (APUs), data processing units (DPUs), Field Programmable Gate Arrays (FPGAs), Smart Network Interface Cards (SmartNICs) and Adaptive System-on-Chip (SoC) products for data centers.

The Client and Gaming segment primarily includes CPUs, APUs, and chipsets for desktops and notebooks, and discrete GPUs, semi-custom SoC products and development services. The Embedded segment primarily includes embedded CPUs, GPUs, APUs, FPGAs, System on Modules (SOMs), 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 amortization of acquisition-related intangibles, employee stock-based compensation expense, acquisition-related and other costs, inventory loss at (recovery from) contract manufacturer and restructuring charges.

(2) Reconciliation of GAAP Net Income to Adjusted EBITDA

Three Months Ended Nine Months Ended

(Millions) (Unaudited)	September 27, 2025		June 28, 2025		September 28, 2024		September 27, September 28, 2025 2024
GAAP net income	$	1,243	$	872 $	771		$ 2,824 $	1,159
Interest expense		37		38	23		95	73
Other (income) expense, net		(82)		(98)	(36)		(219)	(144)
Income tax provision (benefit)		153		(834)	(27)		(558)	(38)
Equity income in investee		(10)		(8)	(7)		(25)	(21)
Stock-based compensation		419		369	351		1,152	1,068
Depreciation and amortization		192		189	171		556	499
Amortization of acquisition-related intangibles		562		568	585		1,697	1,810
Acquisition-related and other costs		43		96	56		181	141
Inventory loss at (recovery from) contract manufacturer		(67)		-	-		(67)	65
Loss contingency on legal matter		12		-	-		12	-
Income from discontinued operations, net of tax		(71)		(104)	-		(175)	-
Adjusted EBITDA	$	2,431	$	1,088 $	1,887		$ 5,473 $	4,612

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, amortization of acquisition-related intangibles, acquisition-related and other costs, inventory loss at (recovery from) contract manufacturer, loss contingency on legal matter, and income from discontinued operations, net of tax. 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 net 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 of Continuing Operations to Free Cash Flow

Three Months Ended Nine Months Ended

	September 27,		June 28,		September 28,		September 27, September 28,
(Millions except percentages) (Unaudited)	2025		2025		2024		2025	2024
GAAP net cash provided by operating activities of continuing operations	$	1,788	$	1,462 $	628		$ 4,189 $ 1,742
Operating cash flow margin % from continuing operations		19%		19%	9%		17%	10%
Purchases of property and equipment		(258)		(282)	(132)		(752)	(428)
Free cash flow	$	1,530	$	1,180 $	496		$ 3,437 $ 1,314
Free cash flow margin %		17%		15%	7%		14%	7%

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 of continuing operations 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.

The Company has provided reconciliations within the earnings press release of these Non-GAAP financial measures to the most directly comparable GAAP financial measures.

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(in millions, except per share data) (Unaudited)
		Three Months Ended
	September 27, 2025	June 28, 2025	September 28, 2024
GAAP gross profit	$ 4,780	$ 3,059	$ 3,419
GAAP gross margin	52%	40%	50%
Stock-based compensation	7	6	5
Amortization of acquisition-related intangibles	260	260	233
Acquisition-related and other costs (1)	-	1	-
Inventory loss at (recovery from) contract manufacturer(2)	(67)	-	-
Loss contingency on legal matter	12	-	-
Non-GAAP gross profit	$ 4,992	$ 3,326	$ 3,657
Non-GAAP gross margin	54%	43%	54%
GAAP operating expenses (3)	$ 3,510	$ 3,193	$ 2,695
GAAP operating expenses/revenue %	38%	42%	40%
Stock-based compensation	412	363	346
Amortization of acquisition-related intangibles	302	308	352
Acquisition-related and other costs (1)	42	93	55
Non-GAAP operating expenses (3)	$ 2,754	$ 2,429	$ 1,942
Non-GAAP operating expenses/revenue %	30%	32%	28%
GAAP operating income (loss)	$ 1,270	$ (134)	$ 724
GAAP operating margin	14%	(2%)	11%
Stock-based compensation	419	369	351
Amortization of acquisition-related intangibles	562	568	585
Acquisition-related and other costs (1)	42	94	55
Inventory loss at (recovery from) contract manufacturer(2)	(67)	-	-
Loss contingency on legal matter	12	-	-
Non-GAAP operating income	$ 2,238	$ 897	$ 1,715
Non-GAAP operating margin	24%	12%	25%

Three Months Ended

September 27, 2025			June 28, 2025			September 28, 2024
GAAP net income / earnings per share	$ 1,243	$ 0.75		$ 872	$ 0.54		$ 771	$ 0.47
Stock-based compensation	419	0.26		369	0.23		351	0.21
Amortization of acquisition-related intangibles	562	0.34		568	0.35		585	0.36
Acquisition-related and other costs (1)	43	0.03		96	0.05		56	0.03
Inventory loss at (recovery from) contract manufacturer(2)	(67)	(0.04)		-	-		-	-
Loss contingency on legal matter	12	0.01		-	-		-	-
(Gains) losses on equity investments, net	(26)	(0.02)		(61)	(0.04)		(1)	-
Equity income in investee	(10)	-		(8)	-		(7)	-
Release of reserves for uncertain tax positions(4)	-	-		(853)	(0.52)		-	-

(140)	(0.09)		(98)	(0.06)		(251)	(0.15)
(71)	(0.04)		(104)	(0.07)		-	-
$ 1,965	$ 1.20		$ 781	$ 0.48		$ 1,504	$ 0.92

Income tax provision

Income from discontinued operations, net of tax(5)

Non-GAAP net income / earnings per share

(1) Acquisition-related and other costs primarily include transaction costs, purchase price fair value adjustments for inventory, certain compensation charges, and workforce rebalancing charges.

(2) Inventory loss at (recovery from) contract manufacturer is related to losses due to an incident at a third-party contract manufacturing facility in Q1'24 and the corresponding recovery.

(3) Effective first quarter of 2025, licensing gain is reclassified against Marketing, general and administrative expenses as the amounts were immaterial.

(4) Release of reserves for uncertain tax positions pertains to the reasonable cause relief related to dual consolidated losses approved by IRS in Q2'25.

(5) Income from discontinued operations is related to ZT Systems' manufacturing business which is classified as held-for-sale.

RECONCILIATION OF GAAP TO ADJUSTED NON-GAAP FINANCIAL MEASURES

(Millions) (Unaudited)

Three Months Ended June 28,

2025

GAAP gross profit $ 3,059 GAAP gross margin 40%

Stock-based compensation, amortization of acquisition-related intangibles, acquisition-related and other costs

267

Inventory and related charges associated with U.S. export restrictions 800

Non-GAAP gross profit (as adjusted to exclude inventory and related $ charges associated with U.S. export restrictions)

Non-GAAP gross margin (as adjusted to exclude inventory and related charges associated with U.S. export restrictions)

4,126

54%