| * | 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 and stock-based compensation expense. In addition, the Company excluded a charge related to the sixth amendment to the WSA with GF for the three and nine months ended September 24, 2016 and restructuring and other special charges, net for the nine months ended September 24, 2016. 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 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 income and expense and income taxes 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. |
| The Company has provided reconciliations within the earnings press release of these non-GAAP financial measures to the most directly comparable GAAP financial measures. |
| ADVANCED MICRO DEVICES, INC. | ||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
| (Millions except per share amounts and percentages) | ||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30,
2017 | July 1,
2017 | September 24,
2016 | September 30,
2017 | September 24,
2016 | ||||||||||||
| Net revenue | $ | 1,643 | $ | 1,222 | $ | 1,307 | $ | 3,849 | $ | 3,166 | ||||||
| Cost of sales | 1,070 | 818 | 1,248 | 2,541 | 2,519 | |||||||||||
| Gross margin | 573 | 404 | 59 | 1,308 | 647 | |||||||||||
| Gross margin % | 35 | % | 33 | % | 5 | % | 34 | % | 20 | % | ||||||
| Research and development | 315 | 279 | 259 | 860 | 744 | |||||||||||
| Marketing, general and administrative | 132 | 125 | 117 | 378 | 339 | |||||||||||
| Restructuring and other special charges, net | - | - | - | - | (10 | ) | ||||||||||
| Licensing gain | - | (25 | ) | (24 | ) | (52 | ) | (57 | ) | |||||||
| Operating income (loss) | 126 | 25 | (293 | ) | 122 | (369 | ) | |||||||||
| Interest expense | (31 | ) | (32 | ) | (41 | ) | (95 | ) | (122 | ) | ||||||
| Other income (expense), net | (3 | ) | (3 | ) | (63 | ) | (11 | ) | 87 | |||||||
| Income (loss) before equity loss and income taxes | 92 | (10 | ) | (397 | ) | 16 | (404 | ) | ||||||||
| Provision for income taxes | 19 | 3 | 4 | 27 | 34 | |||||||||||
| Equity loss in investee | (2 | ) | (3 | ) | (5 | ) | (7 | ) | (8 | ) | ||||||
| Net Income (loss) | $ | 71 | $ | (16 | ) | $ | (406 | ) | $ | (18 | ) | $ | (446 | ) | ||
| Earnings (loss) per share | ||||||||||||||||
| Basic | $ | 0.07 | $ | (0.02 | ) | $ | (0.50 | ) | $ | (0.02 | ) | $ | (0.56 | ) | ||
| Diluted | $ | 0.07 | $ | (0.02 | ) | $ | (0.50 | ) | $ | (0.02 | ) | $ | (0.56 | ) | ||
| Shares used in per share calculation | ||||||||||||||||
| Basic | 957 | 945 | 815 | 947 | 801 | |||||||||||
| Diluted | 1,042 | 945 | 815 | 947 | 801 | |||||||||||
| ADVANCED MICRO DEVICES, INC. | ||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | ||||||||||||||||
| (Millions) | ||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30,
2017 | July 1,
2017 | September 24,
2016 | September 30,
2017 | September 24,
2016 | ||||||||||||
| Total comprehensive income (loss) | $ | 73 | $ | (12 | ) | $ | (406 | ) | $ | (11 | ) | $ | (441 | ) | ||
