Core Insights - AMD reported Q2 2025 revenue of $7.7 billion, a 32% year-over-year increase, exceeding market expectations of approximately $7.4 billion [1] - The company maintains an optimistic outlook for Q3 2025, projecting revenue of $8.7 billion, above market expectations of $8.3 billion, with a forecasted gross margin recovery to 54% [2] - Despite strong performance in client and gaming segments, the data center business growth was below market expectations, primarily due to export restrictions impacting MI308 chips [1][2] Financial Performance - Total revenue for Q2 2025 reached $7.7 billion, with a non-GAAP EPS of $0.48, and a gross margin of 43%, which could rise to 54% when excluding $800 million in costs from export restrictions [1] - Client business revenue was $2.5 billion, up 57% year-over-year, driven by strong sales of the Zen 5 architecture Ryzen processors [1] - Gaming revenue surged to $1.1 billion, a 73% increase year-over-year, significantly contributing to overall revenue growth [1] Business Segment Analysis - Data center revenue was $3.2 billion, a 14% year-over-year increase, but fell short of market expectations due to MI308 chip export limitations [1][3] - Embedded business revenue declined by 4% year-over-year to $824 million [1] - The client and gaming segments were the main drivers of revenue growth, with the PC market recovery and new Ryzen processors boosting client sales [1][3] Market Reaction - Following the earnings report, AMD's stock price fell approximately 3%, attributed to concerns over data center growth lagging behind competitors like NVIDIA, ongoing export restrictions, and profit-taking after significant stock price increases earlier in the year [2][3] - AMD's year-to-date stock price increase exceeds 120%, prompting some investors to realize gains post-earnings [2] Competitive Landscape - In comparison, Intel reported Q2 revenue of $12.86 billion, a mere 0.8% increase, with an EPS of -$0.10, indicating a loss [3] - NVIDIA is expected to report Q2 revenue of approximately $45 billion, a 66% year-over-year increase, with an EPS of around $0.93 [3] - Overall, while AMD's Q2 performance and future guidance surpassed expectations, challenges in the data center segment and export uncertainties have pressured stock performance [3]

Summary of AMD Conference Call Company Overview - **Company**: AMD (Advanced Micro Devices) - **Quarter**: Q2 2025 - **Revenue**: $7.7 billion, a record high, up 32% year-over-year [2][3][22] Key Points Financial Performance - **Revenue Growth**: Achieved a record revenue of $7.7 billion, driven by strong sales in EPYC processors and data center business [2][3][22] - **Gross Margin**: Reported a gross margin of 54%, marking the sixth consecutive quarter of year-over-year gross margin expansion [3][22] - **Free Cash Flow**: Generated over $1 billion in free cash flow [3] - **Operating Income**: $897 million, representing 12% of revenue [22] Data Center Business - **Revenue**: Data center revenue grew 14% year-over-year to $3.2 billion, despite a $155 million operating loss due to MI308 export restrictions [2][5][23] - **AI Business**: The data center AI segment faced challenges due to export restrictions, but MI300 and MI325 series products showed good progress with new contracts signed [10][4] - **EPYC Demand**: Strong demand for EPYC processors, particularly in cloud computing and enterprise workloads [5][23] Client and Gaming Segments - **Client Revenue**: Client segment revenue reached $2.5 billion, up 67% year-over-year, driven by record desktop CPU sales [17][25] - **Gaming Revenue**: Gaming segment revenue increased 73% to $1.1 billion, supported by strong demand for custom chips for next-gen consoles and new GPU launches [19][24] Future Outlook - **Q3 2025 Revenue Guidance**: Expected revenue of approximately $8.7 billion, a year-over-year increase of about 28% [4][29] - **Product Development**: Actively developing the next-generation MI400 series GPUs, expected to deliver up to 40 petaflops of AI computing power [4][13] - **Helios Platform**: Introduction of Helios, a full-stack AI platform expected to provide a tenfold performance leap for advanced models [14] Market Dynamics - **Telecom Sector**: KDDI and Nokia are deploying EPYC processors for 5G networks, enhancing AMD's presence in the telecom industry [6] - **Embedded Business**: Revenue declined 4% to $824 million, but demand is gradually recovering [20][26] Strategic Initiatives - **Acquisitions**: Completed the acquisition of ZT Systems and announced the divestiture of ZT manufacturing business [27][47] - **Cash Management**: Generated $1.5 billion in cash from operations, with a total cash and short-term investments of $5.9 billion [28] Regulatory Challenges - **Export Licenses**: Working with the U.S. Department of Commerce to secure MI308 export licenses to China, with ongoing reviews impacting revenue guidance [16][31] Competitive Position - **High-Performance Computing**: AMD powers over one-third of the world's fastest supercomputers, showcasing its performance and efficiency advantages [9][10] AI and Software Developments - **Rockem Software**: Significant improvements in performance and usability, with the latest version showing over threefold increases in inference and training performance [11][12] Additional Insights - **Market Share**: Positive outlook on server CPU market share growth, particularly in traditional enterprise servers [44] - **Customer Engagement**: Strong interest from customers in MI400 and Helios platforms, indicating a robust pipeline for future growth [38][42] This summary encapsulates the key insights and developments from AMD's recent conference call, highlighting the company's strong financial performance, strategic initiatives, and future outlook in the competitive landscape.

Financial Data and Key Metrics Changes - The company reported record revenue of $7.7 billion for Q2 2025, a 32% increase year-over-year, exceeding the midpoint of guidance [6][26] - Free cash flow reached over $1 billion, and gross margin was reported at 54% excluding an $800 million inventory write-down related to export controls [6][28] - Operating income was $897 million, representing a 12% operating margin, down from 22% a year ago due to inventory charges [29] Business Segment Data and Key Metrics Changes - Data Center segment revenue increased 14% year-over-year to $3.2 billion, driven by strong demand for EPYC processors [7][30] - Client and Gaming segment revenue surged 69% year-over-year to $3.6 billion, with record client CPU sales and strong demand for gaming products [19][31] - Embedded segment revenue decreased 4% year-over-year to $824 million, reflecting mixed demand across end markets [23][32] Market Data and Key Metrics Changes - The company saw robust demand for its EPYC portfolio, particularly in cloud and enterprise workloads, with significant adoption among hyperscalers [7][8] - The gaming segment experienced a 73% year-over-year revenue increase, driven by strong demand for Radeon GPUs and semi-custom products [21][22] - The company noted a decline in Data Center AI revenue due to U.S. export restrictions impacting MI-308 sales to China [10][30] Company Strategy and Development Direction - The company is focused on expanding its AI capabilities, with significant investments in the MI-350 series and upcoming MI-400 series [12][25] - Strategic partnerships and collaborations, such as with Oracle and Humane, are aimed at enhancing AI infrastructure and capabilities [12][25] - The company aims to capitalize on the growing demand for high-performance computing and AI solutions across various markets [24][25] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong demand for high-performance compute and AI solutions, anticipating significant revenue growth in the second half of the year [24][25] - The company is preparing for a ramp in MI-350 series production and expects to see strong adoption in the AI market [10][62] - Management highlighted the importance of regulatory approvals for MI-308 shipments to China, indicating a positive outlook for future revenue contributions from this market [48][49] Other Important Information - The company generated $1.5 billion in cash from operating activities and returned $478 million to shareholders through share repurchases [33][34] - The company is actively working on improving operational efficiencies to enhance gross margins despite the ramp-up of lower-margin products [88] Q&A Session Summary Question: Insights on client business performance and future outlook - Management noted strong performance in the client business, with expectations for continued growth, albeit at a slightly lower rate than the first half of the year [40][44] Question: Update on MI-308 shipments to China - Management is optimistic about resuming MI-308 shipments once licenses are approved, with a focus on working closely with the U.S. administration [48][49] Question: Sovereign opportunities and growth potential - Management indicated that sovereign opportunities are additive to existing growth rates, with significant interest in MI-355 and MI-400 series products [52][55] Question: Data center GPU ramp and revenue expectations - Management expects a strong ramp in data center GPU sales, particularly with MI-355, and positive customer demand for large-scale deployments [60][62] Question: Lead times and customer visibility for MI products - Management confirmed long lead times for MI products, emphasizing strong supply chain preparations for upcoming ramps [81][82] Question: Gross margins and underlying drivers - Management expects gross margins to remain stable, driven by operational efficiencies and growth in higher-margin segments [86][88]

Financial Data and Key Metrics Changes - The company reported record revenue of $7.7 billion for Q2 2025, a 32% increase year over year, exceeding the midpoint of guidance [5][27] - Free cash flow reached over $1 billion, and gross margin was reported at 54% excluding an $800 million inventory write-down related to export controls [5][28] - Operating income was $897 million, representing a 12% operating margin, down from 22% a year ago due to inventory charges [28][30] Business Segment Data and Key Metrics Changes - Data Center segment revenue increased 14% year over year to $3.2 billion, driven by strong demand for EPYC processors [6][30] - Client and Gaming segment revenue surged 69% year over year to $3.6 billion, with record client CPU sales and strong demand for gaming products [19][31] - Embedded segment revenue decreased 4% year over year to $824 million, reflecting mixed demand across markets [24][32] Market Data and Key Metrics Changes - The company saw robust demand for EPYC processors in cloud and enterprise workloads, with significant adoption among hyperscalers [6][8] - The gaming market experienced a 73% year-over-year revenue increase, driven by strong demand for Radeon GPUs and semi-custom products [21][31] - The embedded market showed gradual recovery, with expectations for growth in test and measurement, communications, and aerospace sectors [24][25] Company Strategy and Development Direction - The company is focused on expanding its AI capabilities, with significant investments in the MI350 and upcoming MI400 series accelerators [12][26] - Strategic partnerships, such as the collaboration with Humane for AI infrastructure, highlight the company's commitment to sovereign AI initiatives [12][54] - The company aims to capitalize on the growing demand for high-performance computing across all markets, positioning itself for long-term revenue growth [25][26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the server CPU business, driven by durable demand for cloud and on-premise compute [10][26] - The company anticipates a strong ramp in MI350 series GPU production, with expectations for year-over-year revenue growth in the third quarter [10][62] - Management acknowledged challenges from U.S. export controls but remains confident in the recovery and growth potential in the Chinese market once licenses are approved [18][47] Other Important Information - The company generated $1.5 billion in cash from operating activities, with a total of $5.9 billion in cash and short-term investments at the end of the quarter [33][34] - The company has a share repurchase program with $9.5 billion remaining, reflecting its commitment to returning value to shareholders [34] Q&A Session Summary Question: Client business performance and outlook - Management noted strong performance in the client business, with expectations for continued growth, albeit at a slightly lower rate than the first half of the year [40][44] Question: China market and MI308 shipments - Management is optimistic about resuming MI308 shipments to China once licenses are approved, with inventory primarily in work-in-process rather than finished goods [46][48] Question: Sovereign opportunities and growth potential - Management highlighted the additive nature of sovereign opportunities, particularly with the MI355 and MI400 series, and emphasized the importance of regulatory processes [51][55] Question: Data center GPU ramp and revenue expectations - Management confirmed a strong ramp for MI355, with positive customer demand and expectations for year-over-year growth in the third quarter [60][62] Question: Developer cloud and revenue impact - The developer cloud aims to facilitate easier access to AMD GPUs for developers, though it is not expected to significantly impact revenue in the near term [66] Question: Gross margins and product mix - Management indicated that despite the ramp of MI products, operational efficiencies and a strong mix from the gaming and client segments are expected to maintain gross margins [84][86]

Summary of AMD's 2025 First Quarter Financial Results Conference Call Company Overview - **Company**: Advanced Micro Devices, Inc. (AMD) - **Event**: 2025 First Quarter Financial Results Conference Call - **Key Participants**: Dr. Lisa Hsu (CEO), Gene Hu (CFO) Core Industry Insights - **Industry**: Semiconductor and AI Accelerators - **Market Dynamics**: The company is navigating evolving dynamics related to tariffs and regulatory environments, which are impacting growth but are being offset by strong product demand and market share gains. Financial Performance Highlights - **Revenue**: First quarter revenue increased by 36% year-over-year to **$7.4 billion** [2][12] - **Earnings Per Share (EPS)**: Diluted EPS rose by 55% year-over-year to **$0.96** [12] - **Gross Margin**: Expanded to **54%**, up 140 basis points from the previous year [12] - **Net Income**: Increased by 55% due to a higher percentage of data center product sales and a richer Ryzen processor mix [2] Segment Performance Data Center Segment - **Revenue Growth**: Increased by 57% year-over-year to **$3.7 billion** [12] - **Market Share**: Gained server CPU share driven by the ramp of the 5th Gen EPYC processors [2] - **Hyperscaler Demand**: Strong demand from cloud providers for EPYC deployments [2][3] - **Enterprise Adoption**: Epic CPU sales grew significantly, with more than 450 EPYC-based platforms deployed [4] Client and Gaming Segment - **Revenue Growth**: Increased by 28% year-over-year to **$2.9 billion** [12] - **Client Revenue**: Grew by 68% year-over-year, driven by high-end Ryzen processors [12][13] - **Gaming Revenue**: Decreased by 30% year-over-year, but demand for new Radeon graphics cards remains strong [9] Embedded Segment - **Revenue**: Reported at **$823 million**, down 3% year-over-year [12] - **Market Recovery**: Gradual recovery expected, particularly in aerospace and defense sectors [12] Product Developments and Innovations - **AI Accelerators**: Strong demand for Instinct AI Accelerators, with significant customer engagements in generative AI workloads [5][6] - **New Product Launches**: Introduction of the Ryzen 9950 X3D processor and the MI350 series accelerators expected to drive future growth [8][7] - **Acquisition of ZT Systems**: Completed to enhance systems design capabilities and accelerate data center GPU and systems roadmaps [11] Strategic Outlook - **2025 Guidance**: Despite headwinds from export controls, AMD expects strong double-digit revenue growth in 2025, driven by share gains in CPUs and GPUs [11][14] - **Investment in Growth**: Plans to expand investments in product and technology roadmaps, go-to-market initiatives, and AI software solutions [11] - **Market Positioning**: AMD aims to differentiate itself through a robust product portfolio that combines leadership compute and AI capabilities [11] Risks and Considerations - **Regulatory Environment**: New export license requirements for shipments to China could impact revenue by approximately **$1.5 billion** for the full year [14] - **Inventory Management**: Increased inventory levels to support strong client and server ramp, with a focus on managing supply chain dynamics [19] Conclusion - AMD's strong first quarter results reflect robust demand across its product segments, particularly in data centers and client products. The company is well-positioned for continued growth in 2025, despite facing regulatory challenges and market uncertainties. The strategic focus on AI and high-performance computing is expected to drive future opportunities.

Core Viewpoint - AMD reported strong Q1 2025 earnings, with significant year-over-year growth in revenue and net income, despite a slight quarter-over-quarter decline in revenue [2][5][10]. Financial Performance - Q1 2025 revenue reached $7.438 billion, a 36% increase from $5.473 billion in Q1 2024, but a 3% decrease from $7.658 billion in Q4 2024 [3][10]. - Operating income surged to $806 million, up 2139% year-over-year, while net income rose to $709 million, reflecting a 476% increase [2][3]. - Non-GAAP gross margin was reported at 54%, with diluted earnings per share at $0.96 [2][10]. Business Segments - Revenue sources include data center, client, gaming, and embedded segments [7]. - Data center revenue was $3.7 billion, up 57% year-over-year, driven by strong sales of AMD EPYC CPUs and Instinct GPUs [10]. - Client segment revenue reached $2.9 billion, a 28% increase, with client business growing 68% due to demand for the latest "Zen 5" architecture [10]. AI Chip Development - AMD began providing samples of the AI chip Instinct MI350 series to multiple customers, with production expected to ramp up in the second half of the year [5][6]. - The MI350 series offers 35 times the throughput and performance compared to the MI300X [5]. Regulatory Impact - Recent U.S. export controls on the MI308X chip to China are expected to impact AMD's revenue by approximately $1.5 billion for the full year 2025 [5][10]. - The company anticipates Q2 2025 revenue to be around $7.4 billion, with a potential $800 million impact from the new export controls [10]. Market Outlook - AMD's CEO expressed confidence in achieving double-digit revenue growth for 2025, supported by a strong product portfolio and increasing market share in AI workloads [6][10]. - The company completed the acquisition of ZT Systems to enhance its capabilities in the data center AI accelerator market, which is projected to reach $500 billion by 2028 [8].

Financial Data and Key Metrics Changes - First quarter revenue increased by 36% year over year to $7.4 billion, exceeding consensus estimates [6][27] - Net income rose by 55%, driven by a higher percentage of data center product sales and a richer Ryzen processor mix [7] - Gross margin expanded for the fifth consecutive quarter, reaching 54%, up 140 basis points from a year ago [28] Business Segment Data and Key Metrics Changes - Data Center segment revenue increased by 57% year over year to $3.7 billion, with strong demand for EPYC processors [7][29] - Client and Gaming segment revenue grew by 28% year over year to $2.9 billion, with client revenue up 68% year over year [18][30] - Embedded segment revenue decreased by 3% year over year to $823 million, with gradual recovery expected [23][31] Market Data and Key Metrics Changes - Hyperscaler demand for EPYC processors remained strong, with over 30 new instances launched by major cloud providers [8] - The number of EPYC powered cloud instances activated by Forbes 2000 enterprise customers more than doubled year over year [10] - Demand for AMD-based commercial PCs grew, with Ryzen Pro PC sell-through increasing by over 30% year over year [21] Company Strategy and Development Direction - The company aims to capitalize on growth opportunities in AI and high-performance computing, expanding investments in product and technology roadmaps [25][26] - The acquisition of ZT Systems is expected to enhance AMD's capabilities in providing ready-to-deploy AI solutions [15] - Continued focus on expanding the data center GPU and systems roadmap, with the MI350 series launch anticipated in mid-2025 [17][49] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering strong double-digit revenue growth in 2025 despite macroeconomic headwinds [25][36] - The company expects to see continued strength in client and gaming segments, with a strong outlook for the second quarter [44][45] - Management acknowledged challenges from new export controls affecting MI308 shipments to China, estimating a $1.5 billion revenue impact for the year [33][36] Other Important Information - Operating expenses increased by 28% year over year to $2.2 billion, reflecting aggressive investments in R&D and go-to-market activities [28] - The company generated $939 million in cash from operations, with free cash flow of $727 million [32] - Cash, cash equivalents, and short-term investments totaled $7.3 billion at the end of the quarter [32] Q&A Session Summary Question: Drivers of upside in Q1 and guidance for Q2 growth by segment - Management noted strong performance across multiple business lines, particularly in client and gaming segments, with desktop performance exceeding expectations [41][42] Question: Performance of the Instinct family in Q1 and outlook for the second half - Management indicated that data center GPU performance was in line with expectations, with high customer interest in the upcoming MI350 launch [48][49] Question: Clarification on data center GPU growth expectations - Management confirmed that data center GPU business performed well, with the majority of revenue coming from MI325 and MI300 series [82][84] Question: Impact of inventory increase - Management explained that inventory was built to support strong client and server ramp, as well as upcoming data center GPU demand [56] Question: Feedback on MI400 series and addressing deployment challenges - Management expressed high enthusiasm for the MI400 series and emphasized the importance of planning for rack-scale architectures [60][61] Question: Client business growth expectations and share gains - Management highlighted strong revenue share gains in high-end notebooks and desktops, with a focus on aligning with customer needs [78][79]

Financial Data and Key Metrics Changes - First quarter revenue increased by 36% year over year to $7.4 billion, exceeding consensus estimates [5][28] - Net income rose by 55%, driven by a higher percentage of data center product sales and a richer Ryzen processor mix [6][30] - Gross margin expanded for the fifth consecutive quarter, reaching 54%, up 140 basis points from the previous year [29][30] Business Segment Data and Key Metrics Changes - Data Center segment revenue grew by 57% year over year to $3.7 billion, driven by increased server CPU share and strong demand from hyperscalers [6][31] - Client and Gaming segment revenue increased by 28% year over year to $2.9 billion, with client revenue specifically growing by 68% [19][32] - Embedded segment revenue decreased by 3% year over year to $823 million, with expectations of gradual recovery [24][33] Market Data and Key Metrics Changes - The number of EPYC powered cloud instances activated by enterprise customers more than doubled year over year [8] - Demand for AMD's latest generation AI PC processors increased by over 50% quarter on quarter [20] - The gaming revenue decreased by 30% year over year, primarily due to lower semi-custom sales, although demand signals for 2025 have strengthened [22][23] Company Strategy and Development Direction - The company is focusing on expanding investments in product and technology roadmaps, go-to-market initiatives, and AI software solutions [26][27] - The launch of the fifth generation EPYC processors is expected to drive continued share gains in the data center market [10][11] - The acquisition of ZT Systems aims to enhance the company's capabilities in providing rack-level AI solutions [16][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering strong double-digit revenue growth in 2025 despite macroeconomic uncertainties [26][35] - The company anticipates a significant impact from new export license requirements, estimating a $1.5 billion revenue reduction for the full year [35][36] - Management highlighted the strength of their differentiated product portfolio and execution as key factors for future growth [6][26] Other Important Information - The company completed the acquisition of ZT Systems on March 31, enhancing its systems design expertise [16][34] - The first production shipments of the fifth generation EPYC processors are expected in the second half of 2025 [11][34] Q&A Session Summary Question: Drivers of upside in Q1 and guidance for Q2 growth by segment - Management noted strong performance across client, gaming, and data center businesses, with particular strength in desktop performance and ASPs [41][44] Question: Performance of the Instinct family in Q1 and outlook for the second half - Management indicated that the data center GPU business performed in line with expectations, with high customer interest in the upcoming MI350 launch [49][50] Question: Clarification on data center GPU growth expectations - Management confirmed that the data center GPU business is expected to grow strong double digits despite the headwinds from export controls [83][84] Question: Inventory increase reasons - The increase in inventory was primarily to support strong client and server ramp, as well as the upcoming data center GPU ramp [57][58] Question: Feedback on MI400 series and addressing deployment challenges - Management expressed high enthusiasm for the MI400 series and emphasized the importance of planning and collaboration with customers to address deployment challenges [61][62] Question: Client business growth expectations and market share - Management highlighted strong performance in the client business, particularly in high-end notebooks and desktops, with expectations for continued share gains [80][92]

Financial Data and Key Metrics Changes - The company reported a record first quarter revenue of $7.4 billion, representing a 36% year-over-year increase [6][30] - Gross margin improved to 54%, up 140 basis points from the previous year [30] - Net income increased by 55% year-over-year, driven by a higher percentage of data center product sales [8] Business Line Data and Key Metrics Changes - Data Center segment revenue rose 57% year-over-year to $3.7 billion, with strong demand for EPYC processors [8][31] - Client and Gaming segment revenue increased 28% year-over-year to $2.9 billion, with client revenue growing 68% year-over-year [20][32] - Embedded segment revenue decreased 3% year-over-year to $823 million, with gradual recovery expected [25][33] Market Data and Key Metrics Changes - The company gained server CPU share, particularly in the cloud and enterprise markets, with significant adoption of EPYC processors [9][11] - The number of EPYC-powered cloud instances activated by enterprise customers more than doubled year-over-year [11] - Demand for AI solutions and GPUs is expected to grow, despite export control challenges impacting revenue [27][35] Company Strategy and Development Direction - The company aims to capitalize on growth opportunities in AI and high-performance computing, expanding investments in product and technology roadmaps [27][28] - The acquisition of ZT Systems is expected to enhance the company's capabilities in AI solutions and system design [17][34] - The company plans to launch the next generation MI350 Series and MI400 Series GPUs, targeting significant market share in AI infrastructure [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering strong double-digit revenue growth in 2025, despite macroeconomic uncertainties [27][37] - The company anticipates continued strength in client and gaming segments, with a focus on high-end Ryzen processors [20][46] - Management acknowledged the impact of new export controls on revenue but remains optimistic about overall business performance [35][82] Other Important Information - The company generated $939 million in cash from operations and returned $749 million to shareholders through stock repurchases [34] - The company expects a revenue reduction of approximately $1.5 billion for the full year due to export license requirements [35] Q&A Session Summary Question: Drivers of upside in Q1 and guidance for Q2 growth by segment - Management noted strong performance across multiple business lines, particularly in client and gaming segments, driven by high ASPs and strong desktop performance [42][44] Question: Performance of the Instinct family in Q1 and outlook for the second half - Management indicated that data center GPU performance was in line with expectations, with high customer interest in the upcoming MI350 launch [50][52] Question: Clarification on data center GPU growth expectations - Management confirmed that data center GPU business performed well, with the majority of revenue expected to come from non-China sources in the second half [56][58] Question: Inventory increase reasons - The increase in inventory was primarily to support strong client and server ramp, as well as upcoming data center GPU launches [59] Question: Feedback on MI400 series and addressing deployment challenges - Management highlighted high customer enthusiasm for the MI400 series and emphasized the importance of planning for rack scale architectures [62][64] Question: Client business growth expectations and market share - Management expressed confidence in gaining market share in the client business, particularly in high-end notebooks and desktops [79][80]

Financial Performance - AMD reported a record first quarter revenue of $74 billion, a 36% year-over-year increase[17] - GAAP gross margin was 50%, up from 47% in Q1 2024[21] - Non-GAAP gross margin was 54%, up from 52% in Q1 2024[21] - GAAP operating income increased significantly to $806 million, compared to $36 million in Q1 2024[24] - Non-GAAP operating income increased 57% year-over-year to $1779 billion[30] - GAAP diluted earnings per share (EPS) was $044, up from $007 in Q1 2024[27] - Non-GAAP diluted EPS was $096, a 55% increase year-over-year[27] Segment Results - Data Center segment revenue increased 57% year-over-year to $37 billion, with an operating income of $932 million[31, 35] - Client and Gaming segment revenue increased 28% year-over-year to $29 billion, with an operating income of $496 million[31, 36] - Embedded segment revenue decreased 3% year-over-year to $823 million, with an operating income of $328 million[31, 37] Acquisition and Outlook - AMD completed the acquisition of ZT Systems on March 31, 2025[16, 34] - The company expects Q2 2025 revenue to be approximately $74 billion, plus or minus $300 million[38]