EARNINGS REVIEW
AMD, FY25 Q4 Earnings Results
Historical quarterly report · Results and outlook reflect information available at the time of that release. Actual results from later quarters have not been incorporated into the outlook.
Data Center growth accelerated and revenue exceeded 10 B$. However, the margin benefit from reversing MI308 inventory reserves and sales to China must be identified separately.
Assessment · The direction of revenue growth and cash generation improved. However, margins elevated by inventory reserve reversals should not be treated as repeatable; examine next-quarter product mix and assumptions for China revenue.
Key management and company statements
Earnings release · Excerpt from the original“Our record fourth quarter and full-year results demonstrate AMD’s ability to deliver profitable growth at scale”Meaning · Record fourth-quarter and full-year results demonstrate the ability to deliver profitable growth while scaling up.
Context · This is the CFO’s statement in the company’s earnings release.
Original statement ↗01 Revenue, operating income and results versus expectations
Year over year · revenue 7.658 → 10.270 B$ (+34.1% · +2.612 B$), operating income 0.871 → 1.752 B$ (+101.1% · +0.881 B$).
Quarter over quarter · revenue 9.246 → 10.270 B$ (+11.1% · +1.024 B$), operating income 1.270 → 1.752 B$ (+38.0% · +0.482 B$), operating margin 13.7% → 17.1% (+3.3%p).
Data Center revenue was 5.380 B$, up 1.521 B$ year over year. Client and Gaming grew year over year but declined from the previous quarter.
Results versus previous guidance
Revenue guidance 9.300~9.900 B$ → actual 10.270 B$. 0.370 B$ above the high end.
02 Earnings sustainability · From operating income to net income
Approximately 0.360 B$ of MI308-related inventory reserves and other charges were reversed, while MI308 revenue from China was approximately 0.390 B$. Excluding both, the company reported a non-GAAP gross margin of approximately 55%, different from the reported 57%.
The discontinued-operations net loss of 0.109 B$ related to disposal of the ZT Systems manufacturing business is distinguished from continuing-operations net income of 1.620 B$.
- Operating income
- 1.752 B$
- Net non-operating income
- 0.322 B$
- Income tax expense
- −0.455 B$
- After-tax equity-method income/loss
- 0.001 B$
- Net income/loss from discontinued operations
- −0.109 B$
- Consolidated net income
- 1.511 B$
Net income of 1.511 B$ in the existing quarterly dataset is on a consolidated basis.
03 Cash flow quality · Net income → OCF → FCF
FCF was 2.082 B$, calculated by subtracting CapEx of 0.222 B$ from continuing-operations OCF of 2.304 B$. Discontinued-operations OCF of 0.296 B$ and separate disposal/investment cash flows are excluded from this FCF.
- Net income from continuing operations
- 1.620 B$
- Total net adjustments for noncash items, working capital and other items¹
- 0.684 B$
- Operating cash flow
- 2.304 B$
- Cash CapEx
- −0.222 B$
- FCF
- 2.082 B$
¹ Total net adjustments calculated as OCF−net income. This is not a single disclosed line item; it combines noncash items, working capital, classification differences and other adjustments.
FCF versus previous quarter · 1.530 → 2.082 B$, 0.552 B$ improvement.
04 Financial capacity · Net debt and payment obligations
Previous-quarter net cash · 2025-09-27
Cash and current investments 7.243 / Debt 3.220 B$
Current-quarter net cash · 2025-12-27
Cash and current investments 10.552 / Debt 3.222 B$
Net debt improved by 3.307 B$ from the previous quarter. The carrying amount of current debt is 0.874 B$. It may differ from the principal maturity schedule.
Business disposals and financing affect period-end cash, so the entire improvement in net cash should not be attributed to continuing operating performance. Semiconductor purchase and supply commitments are separate from outstanding debt.
Common definition · Cash and current investments = cash equivalents + current investments and deposits. Debt = carrying amount of interest-bearing borrowings (current + noncurrent), excluding separately reported lease liabilities. This differs from total liabilities of 13.927 B$. Restricted cash, noncurrent securities and noncurrent deposits are excluded from cash and current investments.
05 Investment, capital allocation and cash returns
Customer AI infrastructure plans are growth opportunities, but recognized revenue depends on order timing, supply capacity and product competitiveness. The company’s own facility CapEx alone cannot capture investment exposure across the supply chain.
This quarter, cash CapEx/revenue is 2.2% and FCF/revenue is 20.3%. These ratios should not be used as a simple ranking of companies with different business models and FCF definitions.
06 Next-quarter and full-year outlook: implications
YoY +27.7%~+35.8% · QoQ −7.5%~−1.7%. Revenue comparison bases are 7.438 B$ for the year-earlier corresponding quarter and 10.270 B$ for this quarter. Growth rates are calculated from the original amounts.
Next-quarter guidance includes approximately 0.100 B$ of MI308 revenue from China. Non-GAAP gross margin guidance is approximately 55%, without carrying forward Q4’s inventory-reversal benefit unchanged.
RPO / Backlog
QoQ 0.279 → 0.315 B$ (+12.9% · +0.036 B$).
YoY 0.085 → 0.315 B$ (+270.6% · +0.230 B$).
RPO from development, engineering, IP and product contracts with original terms longer than 1 year. Excludes short-term product orders · Contract balances are not equivalent to confirmed next-quarter revenue or cash inflows. RPO scope differs across companies.
RPO disclosure ↗Quarterly results · CY-aligned presentation
Amounts in B$. Based on the CY-aligned year of this report, the table shows all 4 quarters of the preceding year and the current year to date. Each fiscal quarter is assigned to the CY quarter with the greatest overlap in actual reporting dates, alongside its original FY/CY quarter and start/end dates. Amounts have not been recalculated into actual calendar quarters.
| CY alignment | 2024 · 4 quarters | 2025 · 4 quarters | Change this quarter | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Metric | 2024 total4-quarter totalBalances are period-end | 1QFY24 Q123-12-31 ~24-03-30 | 2QFY24 Q224-03-31 ~24-06-29 | 3QFY24 Q324-06-30 ~24-09-28 | 4QFY24 Q424-09-29 ~24-12-28 | 2025 total4-quarter totalBalances are period-end | 1QFY25 Q124-12-29 ~25-03-29 | 2QFY25 Q225-03-30 ~25-06-28 | 3QFY25 Q325-06-29 ~25-09-27 | 4QFY25 Q425-09-28 ~25-12-27 | QoQvs FY25 Q3 | YoYvs FY24 Q4 |
| Revenue | 25.785 | 5.473 | 5.835 | 6.819 | 7.658 | 34.639 | 7.438 | 7.685 | 9.246 | 10.270 | +11.1%+1.024 B$ | +34.1%+2.612 B$ |
| Operating income | 1.900 | 0.036 | 0.269 | 0.724 | 0.871 | 3.694 | 0.806 | −0.134 | 1.270 | 1.752 | +38.0%+0.482 B$ | +101.1%+0.881 B$ |
| Operating margin | 7.4% | 0.7% | 4.6% | 10.6% | 11.4% | 10.7% | 10.8% | −1.7% | 13.7% | 17.1% | +3.3%p | +5.7%p |
| FCF | 2.405 | 0.379 | 0.439 | 0.496 | 1.091 | 5.519 | 0.727 | 1.180 | 1.530 | 2.082 | +0.552 B$ | +0.991 B$ |
| Operating cash flow | 3.041 | 0.521 | 0.593 | 0.628 | 1.299 | 6.493 | 0.939 | 1.462 | 1.788 | 2.304 | +28.9%+0.516 B$ | +77.4%+1.005 B$ |
| Cash CapEx | 0.636 | 0.142 | 0.154 | 0.132 | 0.208 | 0.974 | 0.212 | 0.282 | 0.258 | 0.222 | −14.0%−0.036 B$ | +6.7%+0.014 B$ |
| Net cash | 3.411 | 3.567 | 3.621 | 2.824 | 3.411 | 7.330 | 3.146 | 2.649 | 4.023 | 7.330 | +3.307 B$ | +3.919 B$ |
| Cash and current investments | 5.132 | 6.035 | 5.340 | 4.544 | 5.132 | 10.552 | 7.310 | 5.867 | 7.243 | 10.552 | +45.7%+3.309 B$ | +105.6%+5.420 B$ |
| Debt | 1.721 | 2.468 | 1.719 | 1.720 | 1.721 | 3.222 | 4.164 | 3.218 | 3.220 | 3.222 | +0.1%+0.002 B$ | +87.2%+1.501 B$ |
Indented rows are components or reference items for the parent metric. Net cash = cash and current investments − debt. Depending on the company definition, FCF may include additional adjustments such as lease principal and therefore differ from operating cash flow − cash CapEx. See the cash flow discussion for the detailed definition.
Annual totals and year-to-date totals appear before each year’s quarters. Revenue, earnings and cash flow are sums of quarterly figures; margin is total operating income ÷ total revenue; net cash, cash and debt are balances at the end of the last quarter. Do not treat totals covering different lengths of time as directly comparable annual figures.
Net cash = cash and current investments − debt. A negative figure indicates net debt. Changes in FCF and net cash are shown as absolute amounts in B$. Quarterly figures have not been adjusted to force reconciliation with disclosed annual totals.
AMD OCF, cash CapEx and FCF are consistently presented on a continuing-operations basis. Their scope differs from the existing dashboard’s OCF and total calculated FCF, which include discontinued operations.
Comparison bases, calculation methods and quarterly sources
Calculation and presentation · Amounts in B$. Figures disclosed in millions of US dollars are divided by 1,000 without altering the source values. Where only cumulative cash flows are available, the previous cumulative period within the same fiscal year is deducted. YoY, QoQ and margins are calculated using amounts before display rounding. Earnings changes from negative or 0 bases are expressed as profit/loss transitions and absolute amounts.
Opinions and outlook · Management quotations include original excerpts and their translations. Quotations not identified as earnings-call transcripts come from earnings releases. Interpretations and implications are the author’s judgments. No numerical probability of achieving a target is assigned without quantitative verification.