Advanced Micro Devices Inc · NASDAQ:AMD
Advanced Micro Devices — Q1 2023 Earnings Presentation
32 slides from Advanced Micro Devices's earnings presentation, May 2, 2023
Slide 1: AMD Financial Results First Quarter 2023
AMD FINANCIAL RESULTS First Quarter 2023 May 2, 2023
Slide 2: Cautionary Statement
Q1 2023 FINANCIAL RESULTS – MAY 2, 202322 CAUTIONARY STATEMENT This presentation contains forward-looking statements concerning Advanced Micro Devices, Inc. (AMD) such as the features, functionality, performance, availability, timing and expected benefits of AMD products; AMD’s expected second quart
Slide 3: Our Journey
Q1 2023 FINANCIAL RESULTS – MAY 2, 202333 Expanding Customer & Partner Ecosystem Data Center and Embedded Growth Strong Financial Foundation Leadership Product Portfolio OUR JOURNEY
Slide 4: Our Leadership Technology
Q1 2023 FINANCIAL RESULTS – MAY 2, 202344 OUR LEADERSHIP TECHNOLOGY Software Enablement Open-source software optimized for performance across heterogenous solutions Data Center Leadership Delivering innovation in cloud, enterprise, AI and accelerated computing Advanced Technology Driving leadership
Slide 5: Our Leadership Products
Q1 2023 FINANCIAL RESULTS – MAY 2, 202355 OUR LEADERSHIP PRODUCTS Embedded Leadership FPGAs, Adaptive SoCs and SoMs, and embedded CPUs and GPUs for a broad set of markets Gaming Top-to-bottom desktop and notebook GPUs, game console and semi-custom SoCs Client Leadership CPUs and APUs for notebook an
Slide 6: AMD Is Uniquely Positioned in AI
AMD IS UNIQUELY POSITIONED IN AI AMD AlveoTM Accelerators AI Inference Optimized Solutions Embedded VersalTM AI Edge ZynqTM MPSoC AI + Sensor Fusion for Embedded AMD 4th Gen EPYCTM Genoa Processors Industry-Leading Server Solution AMD InstinctTM MI300 Accelerators Data Center HPC and AI Solutions Ry
Slide 7: Revenue Q1 2023
Q1 2023 FINANCIAL RESULTS – MAY 2, 20237 REVENUE Q1 2023 ▪ Revenue of $5.4 billion declined 9% y/y as Embedded segment strength was offset by lower Client segment revenue ▪ Q1’23 includes a full quarter of Xilinx compared to a partial quarter in Q1’22 $5.9B $5.4B Q1 2022 Q1 2023
Slide 8: Gross Margin Q1 2023
Q1 2023 FINANCIAL RESULTS – MAY 2, 20238 GROSS MARGIN Q1 2023 1. See Appendices for GAAP to Non-GAAP reconciliation ▪ Non-GAAP gross margin decrease primarily due to Client segment performance Non-GAAP1 48% 44% Q1 2022 Q1 2023 GAAP ▪ Gross margin decrease primarily due to Client segment performance
Slide 9: Operating Income (Loss) Q1 2023
Q1 2023 FINANCIAL RESULTS – MAY 2, 20239 $1.0B $(0.1)B Q1 2022 Q1 2023 OPERATING INCOME (LOSS) Q1 2023 1. See Appendices for GAAP to Non-GAAP reconciliation GAAP Non-GAAP1 $1.8B $1.1B Q1 2022 Q1 2023 ▪ Operating loss primarily due to Client segment performance and amortization of acquisition- relate
Slide 10: Earnings (Loss) Per Share Q1 2023
Q1 2023 FINANCIAL RESULTS – MAY 2, 202310 $1.13 $0.60 Q1 2022 Q1 2023 EARNINGS (LOSS) PER SHARE Q1 2023 1. See Appendices for GAAP to Non-GAAP reconciliation GAAP Non-GAAP1 ▪ Net loss of $139 million compared to net income of $786 million in the prior year ▪ Loss per share of $0.09, compared to earn
Slide 11: Q1 2023 Summary P&L | GAAP
Q1 2023 FINANCIAL RESULTS – MAY 2, 202311 ($ in millions, except per share data) Q1’23 Q1’22 Y/Y Revenue $5,353 $5,887 Down 9% Gross Profit $2,359 $2,818 Down 16% Gross Margin % 44% 48% Down 4 ppts Operating Expenses $2,514 $1,950 Up 29% Operating Expense/Revenue % 47% 33% Up 14 ppts Operating Incom
Slide 12: Q1 2023 Summary P&L | Non-GAAP
Q1 2023 FINANCIAL RESULTS – MAY 2, 202312 ($ in millions, except per share data) Q1’23 Q1’22 Y/Y Revenue $5,353 $5,887 Down 9% Gross Profit $2,675 $3,100 Down 14% Gross Margin % 50% 53% Down 3 ppts Operating Expenses $1,587 $1,346 Up 18% Operating Expense/Revenue % 30% 23% Up 7 ppts Operating Income
Slide 13: Revenue ($ in Billions)
Q1 2023 FINANCIAL RESULTS – MAY 2, 202313 $3.9 $4.3 $4.8 $5.9 $6.6 $5.6 $5.6 $5.4 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 -9% y/y REVENUE ($ in Billions)
Slide 14: Gross Margin (GAAP)
Q1 2023 FINANCIAL RESULTS – MAY 2, 202314 48% 48% 50% 48% 46% 42% 43% 44% Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 GROSS MARGIN (GAAP) -4ppts y/y
Slide 15: Gross Margin (Non-GAAP)
Q1 2023 FINANCIAL RESULTS – MAY 2, 202315 48% 48% 50% 53% 54% Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 50% GROSS MARGIN (Non-GAAP)1 1. See Appendices for GAAP to Non-GAAP reconciliation. 51% 50% -3ppts y/y
Slide 16: Earnings (Loss) Per Share (GAAP)
Q1 2023 FINANCIAL RESULTS – MAY 2, 202316 $0.58 $0.75 $0.80 $0.56 $0.27 $0.04 $0.01 $(0.09) Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 -116% y/y EARNINGS (LOSS) PER SHARE (GAAP)
Slide 17: Earnings Per Share (Non-GAAP)
Q1 2023 FINANCIAL RESULTS – MAY 2, 202317 $0.63 $0.73 $0.92 $1.13 $1.05 $0.67 $0.69 $0.60 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 -47% y/y EARNINGS PER SHARE (Non-GAAP)1 1. See Appendices for GAAP to Non-GAAP reconciliation
Slide 18: Q1 2023 Summary Balance Sheet Items
Q1 2023 FINANCIAL RESULTS – MAY 2, 202318 ▪ Inventories up q/q primarily in anticipation of the ramp of new Data Center and Client products in advanced process nodes Q1 2023 SUMMARY BALANCE SHEET ITEMS ($ in millions) Q1’23 Q4’22 Q/Q Cash, Cash Equivalents and Short-term Investments $5,939 $5,855 Up
Slide 19: Q1 2023 Segment Results
Q1 2023 FINANCIAL RESULTS – MAY 2, 202319 Q1 2023 SEGMENT RESULTS ($ in millions) Q1’23 Q1’22 Y/Y Data Center Net Revenue $1,295 $1,293 Flat Operating Income $148 $427 Down 65% Client Net Revenue $739 $2,124 Down 65% Operating Income (Loss) $(172) $692 Down 125% Gaming Net Revenue $1,757 $1,875 Down
Slide 20: Data Center Segment Q1 2023
Q1 2023 FINANCIAL RESULTS – MAY 2, 202320 DATA CENTER SEGMENT Q1 2023 ▪ Cloud sales grew by a strong double digit percentage y/y ▪ 28 new AMD-powered instances launched including multiple confidential computing offerings from Microsoft Azure, Google Cloud and Oracle Cloud ▪ Many leading OEM provider
Slide 21: Client Segment Q1 2023
Q1 2023 FINANCIAL RESULTS – MAY 2, 202321 CLIENT SEGMENT Q1 2023 ▪ Launched the industry’s fastest gaming processors with the AMD Ryzen 7000X3D series CPUs ▪ In mobile, the first notebooks powered by AMD’s “Dragon Range” CPUs launched to strong demand ▪ “Zen 4”- based “Phoenix” AMD Ryzen 7040 series
Slide 22: Gaming Segment Q1 2023
Q1 2023 FINANCIAL RESULTS – MAY 2, 202322 19% 18% Q1 2022 Q1 2023 GAMING SEGMENT Q1 2023 ▪ Semi-custom SoC revenue grew y/y with strong demand for the premium gaming consoles ▪ Channel sell-through of RadeonTM 6000 and Radeon 7000 series GPUs increased q/q ▪ High-end Radeon 7900 XTX GPU sales were s
Slide 23: Embedded Segment Q1 2023
Q1 2023 FINANCIAL RESULTS – MAY 2, 202323 EMBEDDED SEGMENT Q1 2023 ▪ Launched Zynq RFSoC products to accelerate 4G/5G radio deployments and formed AMD’s 1st Telco Solutions Lab ▪ Subaru rolled out its AMD-based Eyesight 4 platform across their entire range of vehicles ▪ Further portfolio expansion i
Slide 24: Financial Outlook – Non-GAAP
Q1 2023 FINANCIAL RESULTS – MAY 2, 202324 ($ in millions) Q2’23 FY 2023 Revenue ~$5.3 Billion +/- $300 Million Decrease of ~19% y/y Data Center and Embedded Segments expected to grow y/y Gross Margin % ~50% Flattish in 1H Expansion in 2H Operating Expenses ~$1.6 Billion Flattish quarterly until dema
Slide 25: Q1 2023 Summary
Q1 2023 FINANCIAL RESULTS – MAY 2, 20232525 Data Center and Embedded Segments >50% of Revenue Gross Margin 44% Non-GAAP Gross Margin 50% Solid Cash Generation Revenue $5.4B Q1 2023 SUMMARY 1 PROVEN TRACK RECORD OF EXECUTING THROUGH MARKET CYCLES TO DELIVER STRONG SHAREHOLDER RETURNS 1. 1. See Append
Slide 26: AMD Commitment to ESG
Q1 2023 FINANCIAL RESULTS – MAY 2, 20232626 AMD COMMITMENT TO ESG Governance Delivering industry leading products with integrity, innovation and quality in order to help solve global challenges Social Creating a culture that drives innovation by fostering diversity, inclusion and belonging Environme
Slide 27: Our Momentum Driving Long-Term Shareholder Returns
Q1 2023 FINANCIAL RESULTS – MAY 2, 20232727 Large and Compelling $300B TAM World-Class Execution and Focus Unmatched Technology Leadership Expanding Data Center and AI Leadership Strong Balance Sheet OUR MOMENTUM DRIVING LONG-TERM SHAREHOLDER RETURNS
Slide 28: Reconciliation of GAAP to Non-GAAP Gross Profit and Gross Margin
Q1 2023 FINANCIAL RESULTS – MAY 2, 202328 RECONCILIATION OF GAAP TO NON-GAAP GROSS PROFIT AND GROSS MARGIN (Millions) (Unaudited) Q2’21 Q3’21 Q4’21 Q1’22 Q2’22 Q3’22 Q4’22 Q1’23 GAAP gross profit $ 1,830 $ 2,086 $ 2,426 $ 2,818 $ 3,028 $ 2,354 $ 2,403 $ 2,359 GAAP gross margin % 48% 48% 50% 48% 46%
Slide 29: Reconciliation of GAAP Operating Income (Loss) to Non-GAAP
Q1 2023 FINANCIAL RESULTS – MAY 2, 202329 APPENDICES RECONCILIATION OF GAAP OPERATING INCOME (LOSS) TO NON-GAAP OPERATING INCOME (Millions) (Unaudited) Q1’23 Q1’22 GAAP operating income (loss) $ (145) $ 951 GAAP operating margin % (3%) 16% Stock-based compensation 305 174 Acquisition-related costs (
Slide 30: Reconciliation of GAAP to Non-GAAP Net Income / EPS
Q1 2023 FINANCIAL RESULTS – MAY 2, 202330 RECONCILIATION OF GAAP TO NON-GAAP NET INCOME (LOSS)/ EARNINGS (LOSS) PER SHARE (1) Acquisition-related costs primarily comprised of transaction costs, purchase price adjustments for inventory, certain compensation charges and contract termination. (2) GAAP
Slide 31: Share Count Overview
Q1 2023 FINANCIAL RESULTS – MAY 2, 202331 Shares (millions) (1) Q1’23 Q2’23 2023 Actual Estimate Estimate Basic shares 1,611 1,611 1,616 Dilutive impact from employee equity grants and warrant (2) 7 9 8 Diluted shares 1,618 1,620 1,624 APPENDICES SHARE COUNT OVERVIEW The table above provides actual
Slide 32: AMD – Together We Advance
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Advanced Micro Devices — Q1 2023 Earnings Presentation on 6ix