SELECTED CORPORATE DATA(Millions) (Unaudited) Three Months Ended Year Ended December 28,2024 September 28,2024 December 30,2023 December 28,2024 December 30,2023Segment and Category Information(1) Data Center Net revenue$3,859 $3,549 $2,282 $12,579 $6,496 Operating income$1,157 $1,041 $666 $3,482 $1,267 Client Net revenue$2,313 $1,881 $1,461 $7,054 $4,651 Operating income (loss)$446 $276 $55 $897 $(46)Gaming Net revenue$563 $462 $1,368 $2,595 $6,212 Operating income$50 $12 $224 $290 $971 Embedded Net revenue$923 $927 $1,057 $3,557 $5,321 Operating income$362 $372 $461 $1,421 $2,628 All Other Net revenue$— $— $— $— $— Operating loss$(1,144) $(977) $(1,064) $(4,190) $(4,419)Total Net revenue$7,658 $6,819 $6,168 $25,785 $22,680 Operating income$871 $724 $342 $1,900 $401 Other Data Capital expenditures$208 $132 $139 $636 $546 Adjusted EBITDA (2)$2,212 $1,887 $1,576 $6,824 $5,496 Cash, cash equivalents and short-term investments$5,132 $4,544 $5,773 $5,132 $5,773 Free cash flow (3)$1,091 $496 $242 $2,405 $1,121 Total assets$69,226 $69,636 $67,885 $69,226 $67,885 Total debt$1,721 $1,720 $2,468 $1,721 $2,468 (1) 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 segment primarily includes CPUs, APUs, and chipsets for desktops and notebooks. The Gaming segment primarily includes discrete GPUs, and 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 intangible asset, employee stock-based compensation expense, acquisition-related and other costs, inventory loss at contract manufacturer, restructuring charges and licensing gain. (2) Reconciliation of GAAP Net Income to Adjusted EBITDA Three Months Ended Year Ended(Millions) (Unaudited)December 28,2024 September 28,2024 December 30,2023 December 28,2024 December 30,2023GAAP net income$482 $771 $667 $1,641 $854 Interest expense 19 23 27 92 106 Other (income) expense, net (37) (36) (49) (181) (197)Income tax provision (benefit) 419 (27) (297) 381 (346)Equity income in investee (12) (7) (6) (33) (16)Stock-based compensation 339 351 374 1,407 1,380 Depreciation and amortization 186 171 164 685 642 Amortization of acquisition-related intangibles 584 585 635 2,394 2,811 Inventory loss at contract manufacturer — — — 65 — Acquisition-related and other costs 46 56 61 187 262 Restructuring charges 186 — — 186 — Adjusted EBITDA$2,212 $1,887 $1,576 $6,824 $5,496 The Company presents "Adjusted EBITDA” as a supplemental measure of its performance.
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; Nvidia’s dominance in the graphics processing unit market and its aggressive business practices; competitive markets in which AMD’s products are sold; the cyclical nature of the semiconductor industry; market conditions of the industries in which AMD products are sold; AMD's ability to introduce products on a timely basis with expected features and performance levels; loss of a significant customer; economic and market uncertainty; quarterly and seasonal sales patterns; AMD's ability to adequately protect its technology or other intellectual property; unfavorable currency exchange rate fluctuations; ability of third party manufacturers to manufacture AMD's products on a timely basis in sufficient quantities and using competitive technologies; availability of essential equipment, materials, substrates or manufacturing processes; ability to achieve expected manufacturing yields for AMD’s products; AMD's ability to generate revenue from its semi-custom SoC products; potential security vulnerabilities; potential security incidents including IT outages, data loss, data breaches and cyberattacks; uncertainties involving the ordering and shipment of AMD’s products; AMD’s reliance on third-party intellectual property to design and introduce new products; AMD's reliance on third-party companies for design, manufacture and supply of motherboards, software, memory and other computer platform components; AMD's reliance on Microsoft and other software vendors' support to design and develop software to run on AMD’s products; AMD’s reliance on third-party distributors and add-in-board partners; impact of modification or interruption of AMD’s internal business processes and information systems; compatibility of AMD’s products with some or all industry-standard software and hardware; costs related to defective products; efficiency of AMD's supply chain; AMD's ability to rely on third party supply-chain logistics functions; AMD’s ability to effectively control sales of its products on the gray market; long-term impact of climate change on AMD’s business; impact of government actions and regulations such as export regulations, tariffs and trade protection measures; AMD’s ability to realize its deferred tax assets; potential tax liabilities; current and future claims and litigation; impact of environmental laws, conflict minerals related provisions and other laws or regulations; evolving expectations from governments, investors, customers and other stakeholders regarding corporate responsibility matters; issues related to the responsible use of AI; restrictions imposed by agreements governing AMD’s notes, the guarantees of Xilinx’s notes and the revolving credit agreement; impact of acquisitions, joint ventures and/or strategic investments on AMD’s business and AMD’s ability to integrate acquired businesses; our ability to complete the acquisition of ZT Systems; impact of any impairment of the combined company’s assets; political, legal and economic risks and natural disasters; future impairments of technology license purchases; AMD’s ability to attract and retain qualified personnel; and AMD’s stock price volatility.
AMD will provide a real-time audio broadcast of the teleconference on the Investor Relations page of its website at RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (in millions, except per share data) (Unaudited) Three Months Ended Year Ended December 28,2024 September 28,2024 December 30,2023 December 28,2024 December 30,2023GAAP gross profit$3,882 $3,419 $2,911 $12,725 $10,460 GAAP gross margin 51% 50% 47% 49% 46%Stock-based compensation 6 5 6 22 30 Amortization of acquisition-related intangibles 252 233 215 946 942 Acquisition-related and other costs (1) — — 1 1 4 Inventory loss at contract manufacturer (2) — — — 65 — Non-GAAP gross profit$4,140 $3,657 $3,133 $13,759 $11,436 Non-GAAP gross margin 54% 54% 51% 53% 50% GAAP operating expenses$3,022 $2,709 $2,575 $10,873 $10,093 GAAP operating expenses/revenue % 39% 40% 42% 42% 45%Stock-based compensation 333 346 368 1,385 1,350 Amortization of acquisition-related intangibles 332 352 420 1,448 1,869 Acquisition-related and other costs (1) 46 55 60 185 258 Restructuring charges (3) 186 — — 186 — Non-GAAP operating expenses$2,125 $1,956 $1,727 $7,669 $6,616 Non-GAAP operating expenses/revenue % 28% 29% 28% 30% 29% GAAP operating income$871 $724 $342 $1,900 $401 GAAP operating margin 11% 11% 6% 7% 2%Stock-based compensation 339 351 374 1,407 1,380 Amortization of acquisition-related intangibles 584 585 635 2,394 2,811 Acquisition-related and other costs (1) 46 55 61 186 262 Inventory loss at contract manufacturer (2) — — — 65 — Restructuring charges (3) 186 — — 186 — Non-GAAP operating income$2,026 $1,715 $1,412 $6,138 $4,854 Non-GAAP operating margin 26% 25% 23% 24% 21% Three Months Ended Year Ended December 28,2024 September 28,2024 December 30,2023 December 28,2024 December 30,2023GAAP net income / earnings per share$482 $0.29 $771 $0.47 $667 $0.41 $1,641 $1.00 $854 $0.53 (Gains) losses on equity investments, net — — (1) — 1 — 2 — (1) — Stock-based compensation 339 0.21 351 0.21 374 0.23 1,407 0.86 1,380 0.85 Equity income in investee (12) (0.01) (7) — (6) — (33) (0.02) (16) (0.01)Amortization of acquisition-related intangibles 584 0.36 585 0.36 635 0.39 2,394 1.46 2,811 1.73 Acquisition-related and other costs (1) 46 0.03 56 0.03 61 0.04 187 0.11 262 0.16 Inventory loss at contract manufacturer (2) — — — — — — 65 0.04 — — Restructuring charges (3) 186 0.11 — — — — 186 0.11 — — Income tax provision 152 0.10 (251) (0.15) (483) (0.30) (429) (0.25) (988) (0.61)Non-GAAP net income / earnings per share$1,777 $1.09 $1,504 $0.92 $1,249 $0.77 $5,420 $3.31 $4,302 $2.65 (1) Acquisition-related and other costs primarily include transaction costs, purchase price fair value adjustments for inventory, certain compensation charges, contract termination costs and workforce rebalancing charges.(2) Inventory loss at contract manufacturer is related to an incident at a third-party contract manufacturing facility.(3) Restructuring charges are related to the 2024 Restructuring Plan which comprised of employee severance charges and non-cash asset impairments. About AMDFor more than 50 years AMD has driven innovation in high-performance computing, graphics and visualization technologies.
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