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 operating expenses,
non-GAAP research and development and marketing, general and
administrative expenses, 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 non-GAAP free cash flow as
supplemental 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 CFO
Commentary.
2. Testing conducted by AMD Engineering on optimized AMD reference systems.
PC manufacturers may vary configurations yielding different results.
3DMark FireStrike at 3840x2180, Ultra preset, 0xMSAA, 0XAF is used to
simulate GPU performance; the Radeon™ R9 Nano on the system using the
Intel® Core™ i7-5960X 3.0GHz processor, 16GB (4x4GB) DDR4 2666 MHz
memory, Windows 10 64-bit, and AMD Catalyst Driver 15.201 scored 3411
while the Sapphire Radeon™ R9 380 Mini ITX on the same system and AMD
Catalyst Driver 15.20 scored 1551, the GTX 970 Mini ITX on the same
system and GeForce Driver 355.60 WHQL scored 2593, the GTX 960 Mini ITX
on the same system and GeForce Driver scored 1297. GRDT-73
3. Testing conducted by AMD Engineering on optimized AMD reference systems.
PC manufacturers may vary configurations yielding different results. Far
Cry 4 at 3840x2180, Ultra High preset, SMAA, 0XAF is used to simulate GPU
performance; the Radeon™ R9 Nano on the system using the Intel® Core™ i7-
5960X 3.0GHz processor, 16GB (4x4GB) DDR4 2666 MHz memory, Windows 10 64-
bit, and AMD Catalyst Driver 15.201 scored 37.966 fps while the Radeon™
R9 290X on the same system and AMD Catalyst Driver 15.20 scored 27.207
fps GRDT-69
4. Testing conducted by AMD Engineering on optimized AMD reference systems.
PC manufacturers may vary configurations yielding different results. Far
Cry 4 at 3840x2180, Ultra High preset, SMAA, 0XAF is used to simulate GPU
performance; the Radeon™ R9 Nano on the system using the Intel® Core™ i7-
5960X 3.0GHz processor, 16GB (4x4GB) DDR4 2666 MHz memory, Windows 10 64-
bit, and AMD Catalyst Driver 15.201 scored 37.966 fps while the Radeon™
R9 290X on the same system and AMD Catalyst Driver 15.20 scored 27.207
fps GRDT-69
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Millions except per share amounts and percentages)
Three Months Ended Nine Months Ended
------------------------------ --------------------
September June 27, September September September
26, 2015 2015 27, 2014 26, 2015 27, 2014
--------- -------- --------- --------- ---------
Net revenue $ 1,061 $ 942 $ 1,429 $ 3,033 $ 4,267
Cost of sales 822 710 935 2,236 2,788
--------- -------- --------- --------- ---------
Gross margin 239 232 494 797 1,479
Gross margin % 23% 25% 35% 26% 35%
Research and
development 241 235 278 718 834
Marketing, general and
administrative 108 134 150 373 460
Amortization of
acquired intangible
assets - - 3 3 10
Restructuring and other
special charges, net 48 - - 135 -
--------- -------- --------- --------- ---------
Operating income (loss) (158) (137) 63 (432) 175
Interest expense (39) (40) (43) (119) (136)
Other expense, net - (3) (1) (3) (70)
--------- -------- --------- --------- ---------
Income (loss) before
income taxes (197) (180) 19 (554) (31)
Provision for income
taxes - 1 2 4 8
--------- -------- --------- --------- ---------
Net income (loss) $ (197) $ (181) $ 17 $ (558) $ (39)
Net income (loss) per
share
Basic $ (0.25) $ (0.23) $ 0.02 $ (0.72) $ (0.05)
Diluted $ (0.25) $ (0.23) $ 0.02 $ (0.72) $ (0.05)
--------- -------- --------- --------- ---------
Shares used in per
share calculation
Basic 785 778 770 780 765
Diluted 785 778 785 780 765
--------- -------- --------- --------- ---------
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Millions)
Three Months Ended Nine Months Ended
------------------------------ --------------------
September June 27, September September September
26, 2015 2015 27, 2014 26, 2015 27, 2014
--------- -------- --------- --------- ---------
Total comprehensive
income (loss) $ (207) $ (174) $ 15 $ (568) $ (38)
--------- -------- --------- --------- ---------
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Millions)
-----------------------------------------
September 26, June 27, December 27,
2015 2015 2014
------------- ------------- -------------
Assets
Current assets:
Cash and cash equivalents $ 755 $ 829 $ 805
Marketable securities - - 235
Accounts receivable, net 648 687 818
Inventories, net 761 799 685
Prepayments to GLOBALFOUNDRIES 20 19 113
Prepaid expenses 63 54 32
Other current assets 182 63 48
------------- ------------- -------------
Total current assets 2,429 2,451 2,736
Property, plant and equipment, net 194 289 302
Acquisition related intangible
assets, net - - 65
Goodwill 320 320 320
Other assets 286 321 344
------------- ------------- -------------
Total Assets $ 3,229 $ 3,381 $ 3,767
============= ============= =============
Liabilities and Stockholders'
Equity (Deficit)
Current liabilities:
Short-term debt $ 230 $ 235 $ 177
Accounts payable 388 454 415
Payable to GLOBALFOUNDRIES 226 197 218
Accrued liabilities 408 432 518
Other current liabilities 137 30 40
Deferred income on shipments to
distributors 60 51 72
------------- ------------- -------------
Total current liabilities 1,449 1,399 1,440
Long-term debt 2,030 2,034 2,035
Other long-term liabilities 86 89 105
Stockholders' equity (deficit):
Capital stock:
Common stock, par value 8 8 8
Additional paid-in capital 6,997 6,984 6,949
Treasury stock, at cost (122) (121) (119)
Accumulated deficit (7,204) (7,007) (6,646)
Accumulated other comprehensive
loss (15) (5) (5)
------------- ------------- -------------
Total Stockholders' equity
(deficit) (336) (141) 187
------------- ------------- -------------
Total Liabilities and
Stockholders' Equity (Deficit) $ 3,229 $ 3,381 $ 3,767
============= ============= =============
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Millions)
Three Months Nine Months
Ended Ended
------------- -------------
September 26, September 26,
2015 2015
------------- -------------
Cash flows from operating activities:
Net Loss $ (197) $ (558)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 42 133
Stock-based compensation expense 13 47
Non-cash interest expense 2 8
Restructuring and other special charges,
net 11 83
Other 6 7
Changes in operating assets and liabilities:
Accounts receivable 35 164
Inventories 24 (93)
Prepayments to GLOBALFOUNDRIES 3 97
Prepaid expenses and other assets (40) (113)
Accounts payable, accrued liabilities and
other 12 (74)
Payable to GLOBALFOUNDRIES 30 9
------------- -------------
Net cash used in operating activities $ (59) $ (290)
------------- -------------
Cash flows from investing activities:
Purchases of available-for-sale securities - (227)
Purchases of property, plant and equipment (25) (64)
Proceeds from maturities of available-for-
sale securities - 462
Proceeds from sale of property, plant and
equipment 8 8
------------- -------------
Net cash provided by (used in) investing
activities $ (17) $ 179
------------- -------------
Cash flows from financing activities:
Net proceeds from grants 4 8
Proceeds from issuance of common stock - 1
Proceeds from borrowings, net - 100
Repayments of long-term debt and capital
lease obligations - (44)
Other (2) (4)
------------- -------------
Net cash provided by financing activities $ 2 $ 61
------------- -------------
Net decrease in cash and cash equivalents (74) (50)
------------- -------------
Cash and cash equivalents at beginning of
period $ 829 $ 805
------------- -------------
Cash and cash equivalents at end of period $ 755 $ 755
------------- -------------
ADVANCED MICRO DEVICES, INC.
SELECTED CORPORATE DATA
(Millions except headcount)
Three Months Ended Nine Months Ended
------------------------------ --------------------
Segment and Category September June 27, September September September
Information 26, 2015 2015 27, 2014 26, 2015 27, 2014
--------- -------- --------- --------- ---------
Computing and
Graphics (1)
Net revenue $ 424 $ 379 $ 781 $ 1,335 $ 2,470
Operating loss $ (181) $ (147) $ (17) $ (403) $ (20)
Enterprise, Embedded
and Semi-Custom (2)
Net revenue $ 637 $ 563 648 $ 1,698 $ 1,797
Operating income $ 84 $ 27 $ 108 $ 156 $ 290
All Other (3)
Net revenue - - - - -
Operating loss $ (61) $ (17) (28) $ (185) (95)
Total
Net revenue $ 1,061 $ 942 $ 1,429 $ 3,033 $ 4,267
Operating income
(loss) $ (158) $ (137) $ 63 $ (432) $ 175
--------- -------- --------- --------- ---------
Other Data
Depreciation and
amortization,
excluding
amortization of
acquired intangible
assets $ 42 $ 45 $ 46 $ 130 $ 145
Capital additions $ 25 $ 17 $ 29 $ 64 $ 73
Adjusted EBITDA (4) $ (55) $ (42) $ 133 $ (84) $ 409
Cash, cash
equivalents and
marketable
securities $ 755 $ 829 $ 938 $ 755 $ 938
Non-GAAP free cash
flow (5) $ (84) $ (75) $ (11) $ (354) $ (287)
Total assets $ 3,229 $ 3,381 $ 4,325 $ 3,229 $ 4,325
Total debt $ 2,260 $ 2,269 $ 2,208 $ 2,260 $ 2,208
Headcount 9,475 9,469 10,149 9,475 10,149
--------- -------- --------- --------- ---------
(1) Computing and Graphics segment primarily includes desktop and notebook
processors, chipsets, discrete graphics processing units (GPUs) and
professional graphics.
(2) 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.
(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 are amortization of acquired intangible assets and stock-
based compensation expense. In addition, the Company also included the
following adjustments for the indicated periods: for the third quarter
of 2015 and nine months ended September 26, 2015, the Company included
net restructuring and other special charges; and for the nine months
ended September 27, 2014, the Company included an adjustment for
workforce rebalancing severance charges.
(4) Reconciliation of GAAP Operating Income (Loss) to Adjusted EBITDA*
Three Months Ended Nine Months Ended
------------------------------ --------------------
September June 27, September September September
26, 2015 2015 27, 2014 26, 2015 27, 2014
--------- -------- --------- --------- ---------
GAAP operating
income (loss) $ (158) $ (137) $ 63 $ (432) $ 175
Restructuring and
other special
charges, net 48 - - 135 -
Technology node
transition charge - 33 - 33 -
Stock-based
compensation
expense 13 17 21 47 65
Amortization of
acquired
intangible assets - - 3 3 10
Depreciation and
amortization 42 45 46 130 145
Workforce
rebalancing
severance charges - - - - 14
--------- -------- --------- --------- ---------
Adjusted EBITDA $ (55) $ (42) $ 133 $ (84) $ 409
========= ======== ========= ========= =========
(5) Non-GAAP free cash flow reconciliation**
Three Months Ended Nine Months Ended
------------------------------ --------------------
September June September September September
26, 2015 27,2015 27, 2014 26, 2015 27, 2014
--------- -------- --------- --------- ---------
GAAP net cash
provided by (used
in) operating
activities $ (59) $ (58) $ 18 $ (290) $ (214)
Purchases of
property, plant
and equipment (25) (17) (29) (64) (73)
--------- -------- --------- --------- ---------
Non-GAAP free cash
flow $ (84) $ (75) $ (11) $ (354) $ (287)
========= ======== ========= ========= =========
* 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, stock-based
compensation expense and amortization of acquired intangible assets. In
addition, the Company also excluded the following adjustments for the
indicated periods: for the third quarter of 2015 and nine months ended
September 26, 2015, the Company excluded restructuring and other
special charges, net, for the second quarter of 2015 and nine months
ended September 26, 2015, the Company excluded a technology node
transition charge, and for the nine months ended September 27, 2014,
the Company excluded an adjustment for workforce rebalancing severance
charges. The Company calculates and communicates Adjusted EBITDA
because the Company's 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 and income taxes that can
affect cash flows.
** The Company also presents non-GAAP free cash flow as a supplemental
measure of its performance. Non-GAAP free cash flow is determined by
adjusting GAAP net cash provided by (used in) operating activities for
capital expenditures. The Company calculates and communicates non-GAAP
free cash flow in the financial earnings press release because the
Company's management believes it is of importance to investors to
understand the nature of these cash flows. The Company's calculation of
non-GAAP 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 non-GAAP 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.
AMD Reports 2015 Third Quarter Results
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