AMD, FY26 Q2 Earnings Results

01 Revenue, operating income and results versus expectations

Year over year · revenue 7.685 → 11.536 B$ (+50.1% · +3.851 B$), operating income −0.134 → 1.990 B$ (turned profitable · +2.124 B$).

Quarter over quarter · revenue 10.253 → 11.536 B$ (+12.5% · +1.283 B$), operating income 1.476 → 1.990 B$ (+34.8% · +0.514 B$), operating margin 14.4% → 17.3% (+2.9%p).

Data Center revenue increased by 3.478 B$ and accounted for approximately 58% of total company revenue. Client revenue of 3.062 B$ and Gaming revenue of 0.779 B$ are components of the Client & Gaming total.

02 Earnings sustainability · From operating income to net income

The year-earlier quarter included approximately 0.800 B$ of inventory and other charges related to MI308 export restrictions. Because the company moved from a prior-year operating loss to profit, an absolute improvement is used instead of a growth rate.

The difference between GAAP operating income of 1.990 B$ and non-GAAP operating income of 3.094 B$ consists of adjustments for stock-based compensation of 0.503 B$, intangible asset amortization of 0.544 B$, acquisition-related costs of 0.040 B$ and legal costs of 0.017 B$.

Net income from continuing operations was 2.305 B$ and the net loss from discontinued operations was 0.008 B$, producing consolidated net income of 2.297 B$. Investment gains of 0.483 B$ are also included, so note the distinction between operating income and net income.

Operating income

1.990 B$

Net non-operating income

0.561 B$

Income tax expense

−0.252 B$

After-tax equity-method income/loss

0.006 B$

Net income/loss from discontinued operations

−0.008 B$

Consolidated net income

2.297 B$

Net income of 2.297 B$ in the existing quarterly dataset is on a consolidated basis.

03 Cash flow quality · Net income → OCF → FCF

This report’s OCF of 2.366 B$ and CapEx of 0.808 B$ relate to continuing operations and reconcile to company FCF of 1.558 B$. Discontinued-operations cash flows are excluded.

Net income from continuing operations

2.305 B$

Total net adjustments for noncash items, working capital and other items¹

0.061 B$

Operating cash flow

2.366 B$

Cash CapEx

−0.808 B$

FCF

1.558 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 · 2.566 → 1.558 B$, 1.008 B$ deterioration.

04 Financial capacity · Net debt and payment obligations

Net debt improved by 0.762 B$ from the previous quarter. The carrying amount of current debt is 0.875 B$. It may differ from the principal maturity schedule.

Period-end debt comprises current debt of 0.875 B$ and noncurrent debt of 2.351 B$. The table below does not double-count the same borrowings as both short-term debt and current portions of long-term 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 17.240 B$. Restricted cash, noncurrent securities and noncurrent deposits are excluded from cash and current investments.

05 Investment, capital allocation and cash returns

A fabless company’s cash CapEx mainly covers its own buildings and equipment. It is not total AI investment inclusive of outsourced production, packaging and supply-chain purchase commitments, so avoid simplistic comparisons with data-center operators’ CapEx ratios that ignore business models.

This quarter, cash CapEx/revenue is 7.0% and FCF/revenue is 13.5%. 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 +37.4%~+43.8% · QoQ +10.1%~+15.3%. Revenue comparison bases are 9.246 B$ for the year-earlier corresponding quarter and 11.536 B$ for this quarter. Growth rates are calculated from the original amounts.

Next-quarter revenue guidance is 13.0±0.3 B$, with non-GAAP gross margin of 56%. The quarterly outlook assumes revenue expansion and an improved product mix, but actual results may differ because of regulatory and supply constraints.

RPO / Backlog

QoQ 0.264 → 0.222 B$ (−15.9% · −0.042 B$).

YoY 0.218 → 0.222 B$ (+1.8% · +0.004 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.

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.

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.

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.