Advanced Micro Devices (AMD) 3 Aug 222022 Q2 Earnings call transcript

Hello and welcome to the AMD Second Quarter 2022 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It’s now my pleasure to turn the call over to Laura Graves, Corporate Vice President, Investor Relations. Please go ahead, Laura.

Thank you and welcome to AMD’s second quarter 2022 financial results conference call. have earnings opportunity slides. press should copy review you our of release now, had to the a By and accompanying

you page these on reviewed have can If found be documents, the amd.com. of they Relations Investor not

We our this The will website. are in full during and release reconciliations call. today’s GAAP refer press non-GAAP to slides measures to available primarily financial non-GAAP posted on

end results aligns our our today’s financial Executive on Su, reflect Participants strategic with business we addition, and segment webcast Lisa which Chair and Chief will Treasurer. Executive Officer our call Officer; conference In via and replayed reporting, today’s our manage Devinder website. Vice how now Kumar, Chief in This our be Dr. call live President, is markets. on a new and Financial are

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include EPYC AMD-powered processors and Center Micro, triplets. as Data Google, and across Dell, sequentially EPYC powered Azure demand accelerated billion, our that with data in proud list the to solutions center instances further more and increased by powered GREENXXX launched of by We Oak brought growth on XX% than many Oracle, Synopsys, start cloud processors world’s one was debuting build Lenovo, supercomputers. that year-over-year anyone tailored XXX me by supercomputer. and unique Cisco Systems, AMD-based XX in processing was HPE barrier In both am by cloud, year-over-year the AWS, HPE processor deliver our ability enterprise to record-setting examples Ridge cloud-based block performance. software-as-a-service the industry’s else. establishing in chip sales. adoption servers, number others quarter, design by supercomputer, our enterprise the fastest $X.X and than XD ProLiant Microsoft footprint across virtualization made with the Lenovo’s Recent highlights the led quarter in and Let transaction from solution market from the and for in Think and XX% the and spot and including the workloads. performance is for first GPU stacked processor Revenue delivering our record third-gen customers. with new the significant Baidu, Milan-X and enterprise, top leadership Azure HPE, most the push the TCO work processors Frontier In Instinct made price I Super segment. the National OEM of with significant quarter, quarter record both in strong to server envelope AMD’s to setting a of and milestone extremely computing energy-efficient a the faster list exa progress performance Breaking highlighted world exascale Laboratory supercomputers world’s AMD-powered accelerators, further computing it first the possible fact EPYC Microsoft

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Analyst billion as we highlighted in the revenue opportunities AMD together. at Day Financial $XX have Xilinx synergy June, bring we As long-term greater identified assets and in than our we

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color call provide second over on like additional financial to quarter Devinder? Now to the turn I’d to Devinder performance. our some

afternoon good demand AMD everyone. record second gross and and Strong expansion. for margin reported Lisa excellent continued quarterly results. leadership you, our revenue Thank drove products quarter

closed quarter includes quarter Xilinx’s pleased second of have quarter. of to acquisition The the and the in first results Pensando financial we full are the

ago up a up up a to $X.X year basis income income to by Operating million year revenue. up $X.X company. by from as from XX% data scale and the record per share Second significant ago, driven Operating inclusion Xilinx year billion, higher across we year revenue. revenue $X.X all was to ago. margin. billion, expenses to points $X.XX year than million, segments Net share XXX a XX%, a gross higher million higher revenue was share, more margin by and $X.XX from year $XXX driven $X.X Earnings ago, a ago and ago. a margin XX%, was compared center embedded was growth the Gross doubled primarily quarter per was continue per record ago. XX% compared Operating billion $XXX revenue a from of year were a from driven

turning our Now, reportable to segments.

ago. previously the year-over-year, a we XX% reporting segment end expenses. of Client sales. now Center Data operating with revenue million to Operating business. a we segment income from ago. by higher Embedded driven up year-over-year, was or revenue or to center Gaming higher XX% align Xilinx the driven XX% data data driven CPUs, partially server was segment GPUs, revenue million by of a product includes primarily XX% higher expenses. higher in third-generation Data income As Client and year by billion, was The by XX% to or by was higher Xilinx was $X.X our up by segment the of Data driven XX% income center manage million operating up $XXX revenue Center mix markets revenue notebook Gaming million offset AMD strategic revenue, XX% sales. was of or compared higher Operating year strong compared Xilinx and revenue billion, and Ryzen driven $X.X communicated, stronger driven desktop Center embedded our modified Revenue way year-over-year, and $XXX with offset products. PC processor segment. Higher chipsets, discrete Client the mobile Gaming The game of includes graphic includes Starting by revenue. semi-custom million primarily was partially segment income $X.X was segment a products. was billion, to operating of richer revenue million process and EPYC server processors both million revenue. graphics includes growth driven partially XX% ago, console semi-custom XX% products. compared and segment Higher or billion, or expenses. segment operating The to while a revenue million embedded Pensando operating expenses. XX% income primarily Embedded lower was by primarily and operating year lower was revenue or revenue up $X.X due by operating $X operating XX% primarily compared ago, $XXX revenue. billion $XXX income was by improvement income the higher year inclusion which $XXX $X.X operating margin driven $XXX to offset a processor semi-custom operating by Embedded ago. year higher was $XXX or

quarter. sheet. Turning and to end short-term was billion cash the the balance second Cash, at of the $X investments equivalents

$X.X compared have to quarter million we common Inventory stock $XXX to up half quarter, the was $XXX the deployed revenue second last $X million the repurchase $XXX year. billion. in free remaining a support of million flow billion, from and and was same quarter Quarterly $X.X billion Cash cash in was During operations million authorization. Pensando. of $XXX prior approximately in the from record inclusion

During $X billion. debt the investment-grade in by debt market AMD the we established quarter, of issuing

to outlook customer based the demand Turning expectations is financial our environment outlook. contemplates current and macroeconomic current on Today’s signals. and

For to be minus the Embedded expect the we growth or XX% increase $XXX approximately primarily revenue billion, XXXX, third by million, segments. year-over-year, of approximately quarter an and in led $X.X of Data Center plus

million rate on addition tax the shares. $X.XX interest or expect be to non-GAAP based taxes we other for XXXX, operating and X.XX $XXX XX% of to count QX share non-GAAP expense, approximately be approximately be revenue, be approximately margin diluted effective In expenses the to non-GAAP gross and approximately XX%, to billion XX.X% billion

to full at year, growth approximately of Center midpoint increase billion, or continue and expect the segments. by $XXX $XX.X minus led revenue million, the of approximately we For in Embedded an plus XX% Data

gross and record excellent quarter, second We with approximately continue year-over-year segments, XX%. expect expansions margin to be across In growth profitability. had to all we margin closing, an revenue non-GAAP

financial ahead, navigate with dynamic closely conditions. objectives, on we remain customers and work executing our Looking focused to signals market continuing monitor the product to our and while market

are We our financial are we and for revenue confident growth that power. driven earnings by model diversification, well-positioned long-term

wish With Q&A Laura her opportunity we her our on the we Graves us to month. her Laura. Before you, and to this let Q&A, Thank begin to like of success service to AMD that, the later take transition every all for would thank retirement call. this portion

Kevin, you, please. go Thank Devinder. begin ahead Q&A, and the

is question from from first Our Goldman coming Sachs. Hari Instructions] [Operator Toshiya Certainly.

is now line Your live.

questions. Great. Laura Thank had much taking retirement. so question. on Congrats your two you for upcoming to I the

margins? basis, understand your that QX follow-up. And contemplated on of I and first minus The can well revenue in as to and guidance, better guidance, your the wanted one, what’s to a QX gross guidance, sequential I terms then pluses be you your kind speak of in have helpful. would implied as super both a If

for Sure. Thanks, the Toshiya, question.

QX first QX is we in increase historically the with well as that, Data quarter. terms our the start as so the QX I in So the all, Game Console Center, of revenue implies guidance, led growth would QX, some semi-custom first in if guidance peaks the the and third which of think by or business,

taken have conservative outlook a the on We PC business. more

is And same as be set have down, So product a the ramps guidance. contemplated quarter the a our the we’re sequential the of ago, view Data quarter that we that there as it, But we would into is, what call with what will single PC it, of let’s fourth about. is excited again, new have go we thought PC be will digits. the call quarter, business there And as the growth let’s we led Center, third well down, business into the see mid-teens. current very also Embedded it be by then view business. that’s high business, our our And PC would that of

number graphics a general be of have our server fourth well our products, we X-nanometer as products, in that well including ramping products So the products. as our client as quarter, – our as will

business And standpoint. in margin at then of – margin of of we is again, So is same. that. again, that a a guiding QX the which the standpoint, each businesses full we’re year from it’s which from that’s QX view in revenue resulting is And sort the what and of a mix XX%,

around speak business. what the to in Center seeing was I Data Got It. hoping Thank My your particularly can assumptions. your PC you’re you follow-up, for color you

terms the bunch have? concerns revenue you the overall And were your do point are Given dependent the market? we kind recent I at the the the year point? in at of question both a quarter, on related probably questions you you sort from enterprise to if we investors competitor you’re scale, of what most macro about backdrop, get about in you do X.X% ago. take and cloud. visibility a because spending customers of about telling asked What your forward of nearest become this And of What third the more and

significantly curious you with you’re do obviously, you. point, more market? the X at larger, correlated So Thank become broader

question Data the for the on Thanks Yes. Centers.

So look, grown business very us. the Data Center has nicely for

We’re segment growth year-over-year a the pleased sequential on with as basis. both a well as

see example, in for the did business what seeing terms In the that, to of Cloud continue we strong. underneath we’re be quarter, very second

continuing of instances with into So see cloud continuing half and the we our from new from workloads year. ramp – what that and we’re customers, Milan we to the second

For the the bit I as well. more make did more also OEM actually are What and correlated mixed some macro there a say side would is to we on business, progress trends the a Enterprise perhaps good of the backdrop. there

second product the into Milan the of and XXXX. continuing I significant then the do a see part half the there little match all, see And the But bit Genoa that some our would in ramp taking we are longer of just set of opportunities I of coming as that close. we think in OEMs XXXX continue to the end second given said, cycle, a half I of are through. we positioning. year. the we see And strong say into although So see this deals in go as to working to pipeline, And into some all of growth we into towards year significant year are things the the

a we think are your market? think, become – mean, we correlated we’ve more question, So share. of I do do overall gained certainly I lot I to the to

especially this that the of half and the we underrepresented. larger a for second large cloud of customers’ but And And with our four quarters, market, year us good are gives still good. visibility we’re next visibility. next to really customers, six piece very we’re into year is our So planning the

Very helpful. Thank you so much.

Sure.

Thank you.

Arya Your from next Bank coming question from of Vivek America is Securities.

Your is now line live.

my you wanted recently large competitor the Data unchanged. your inventory, Enterprise and Center etcetera, leaving picture taking but graphics excess see could I talking presented about you inventory and just PC PC I’m second half you way the expectations your to second relatively for de-risked question. very revisit Thanks because competitors? outlook Lisa, do bleak today? main a are think do excess your you your or or you inventory AMD half see how by it levels? from adequately curious, think server is of be Just impacted your And any

Vivek. sure, Yes,

So you the our look, half full year if let’s second at and talk guidance. look guidance, maybe about

some and how We have are takes business puts – the we’re today. seeing there in

demand So whenever business. the looking PC well as as are we half, guide, the current more for our that multiple what in at. And being in the second we there saying are year recognize continue Data see we business, we the guidance conservative that in strong outlook. we’re Embedded our in the full to and dynamics Center, In that we’re is Console

would it, somewhere call at now market million XXX around, outlook let’s at PC million kind Our the of put mid-teens to units. XXX

I think we’ve de-risked appropriately So the PC business. do

the look quarter. given relates the we it some as of situation, lockdowns at things and to COVID in inventory As current the second

of inventory, that as will rebalance the a is was portion of bit account result, taken second buildup year. itself I in we’ve think in a the modest. second and And the half. in half into AMD the there it think We of that PC

Server were has think good is constrained things were we side, areas. quarter. again, on tight second portfolio And that quarter. I about with side, the Certainly, we the feel very we in constrained the half. of second in the one even the that of second still on we several overall, So important supply were the have, Embedded we been the the in supply And

supply additional of from especially of have meet that’s the year. We help towards demand customers. really get online, us the the That coming as we end will more

of So and those takes. puts good all we feel pretty about

one my Lisa, for on side. it. center more Got the follow-up, And data

a broader Genoa environment Sapphire shows next-gen offset now. levels, coming just of outlook? kind right you just we have enough to you So perspective? reports story very a media their feeling about any in of are with from control Or strong think Rapids later share their gain Genoa do do how spending the cloud spending versus etcetera. slowdown wanting you But up year cloud out all you competitive to this When And the spending outlook? spending about players see seems that think these

Vivek. Yes,

in So seeing talking what I would is of What mean, we about say and different. I spend customers. is the large every customer lot in time with our a their markets, seeing customers particularly businesses they’re what their cloud they’re

dynamics So own they each their of what optimize. have trying they’re to

might forecast next seen North strong in the have slowdown think have we’re China, and of We been robust that. in share I feel But and to certainly, a you expected with year. we cloud, a question, overall very are a they’ve Relative your do this bit America year, position. for like gain

next I positioning we right Genoa product very is is into well And strong year. is think that positioned well now. the Milan think as such very very, that

we’ll expanding they’re with business what have But well. our spend as and an is have opportunity think to view I Data XXXX. So the set the portfolio grow Center we we current always from our continue strong a And see customer into to view, seeing. time

Bergamo, which capability year. well our as that’s have optimized we Genoa, to next is cloud a online addition In early coming

are there of growth products is ambitions. lot our supporting that a new sort So of

Thank you.

Thank you.

Our is Rasgon Research. from next Bernstein from question Stacy

is line live. Your

Hi, guys. my taking for Thanks questions.

case, stronger still into previously? supply the publicly to little the bit on the Rapids into were in admitted in as server go what And feel on push that’s of out in like supply we Does ramp, the if Sapphire especially you make number on For have as that year we has it see general my get sounds next a delay? now if Do for server do upside you wake you the Genoa actually own constrain like very may you guess get I for QX. orders first question, XXXX? it a you of sort their stronger larger have seen your Is product. than your competitor it that better

question. Sure, Stacy. the for Thanks

our focused them our very very to we’re So us work customers get product ramp possible. as continue ramp. to as was key And on certainly, own to the to for fast closely with

I Genoa There’s well good. on quickly very a of stuff. very very feedback from performance lot looks the set. customer both some think looks interest as as of strong the ramp cloud, in high-end The the gotten good. We’ve to enterprise

we feel XX the it. about your So capacity handle. supply, very And good have the we to growth can basically to building last about across support world type of spent the the months question our think product that we

So there is to five that supply think over the And a work we we’ll expect in on I to next four, quarters. large step-up see that. continue

Got you. Thank it.

Thanks. outlook. For I The gross it up to XX%. QX about be like bit to would helpful. the dig driving of on a could it’s if QX is the case. with on fair XXX it into increase Center questions Data of margins at bulk more going my I little margins any at QX. a more may it’s some into look magnitude the say QX that’s to increase that taken it, to to that further color give Embedded? But bps probably be be would I continues dead that, me sequential and midpoint us you suggest increase, you answered But gross the of the that implied guess, of what’s some X% drivers to from wanted follow-up, know the I Again, something

Yes.

led performed a Embedded Center I is well. Embedded Very within segments. of well. the as the think, really the and in the seeing increase Actually, the certainly very margin, it Data bulk that business there. by with pleased segment And the mix growth is we’re much Stacy, has then the terms of our

Data are, in well some Cloud Embedded more than data and we the the from communications that’s I it’s supply is So the on additional product the for up, in a QX. is more think, and a as of into just supported center other increase, bit But a but are markets. Center that fourth bit the in have minuses Overall, get given mix some X% reminder, and going all pluses than Enterprise, coming the Embedded XX-week new of yes, as to we little a And quarter. ramps us very quarter also addition of to

all sort implied those give of so, us guide. And the things

it. Got

XX-week. the helpful. Thank Got about Forgot it. so you that’s much,

The you. Bank. Ross Deutsche coming next question is Thank from from Seymore

Your line live. is now

congrats environment I question thanks especially your into this on Laura, Gaming Lisa, in congratulations and me the solid Hi, want letting for the business. dig results, retirement. to a ask and on bit a little

obviously parts of game dynamics that: things. the side have happening very You are GPUs and client there different like It console the two of seems the there.

sounded the like a bit about believe Can strong side going going talked quarter. the you I the year-over-year third semi-custom when then you the a the reflection it’s of So any on? that Is – PC there there? remain said rest the to happening you about market or you gains, issues product for of color, in just is year. talk be client sort the down GPU would of And what’s just little share

is year as be the seasonal there of appreciate – should it some third there is the is fourth So that or well? we just – of year, would effect I sort guess, ramp the or

Thanks Ross. Sure, Yes. for question. the

two of the business. Gaming halves Console our the the then consumer is or business sort So graphics of discrete the our graphics and Game

very I take that on So that has been The strong. first. Console semi-custom the side, business say would let’s

for able I were say half been supply We’ve cycle. additional this get in first a sort supply of into more constrained it’s strong So would year. the of year last that. to Overall, we

continued there’s strong the belief that consoles. a think it’s cycle I for

decline the fourth quarter. consoles expect in in see peak normal We third would to quarter, and the then seasonality a the

into – off year, gaming we’ll do this quarter, spending. that XXXX the it sort of fourth graphics, we’ll new is the second that here we business to seen are we the graphics to that as as the supply to As high, increase in we issues products as versus entered consumer would expect now that slowdown sort that relates for a consumer as the have strong was some I demand due a go in it very of because were demand and of say more well somewhat expect, We very relates some we we coming and demand, consumer have where though, see supply macro in quarter, timeframe. that sequential now as launching of

takes. are the and those So puts

think a of continue well long-term the But sort segment. the dealing believe so Consoles to with. short-term a Game as is that secular in we I we’re for some dynamics driver. fact the market have Gaming are that overall, There I performed PC positive here think the is segment, a

guess, gross color. for all margin things. Thanks that side the over my follow-up, of to for I switching

You job and obviously guys bar have on an the that, as done Xilinx raise well. helps amazing

we you how What’s this target feeling? think we look if the of will that that next be cost March that I simultaneously. do to have can just at are of drivers you and Do the lessen And think you you of year? tight know sort XX. a XX%, kind about about looser? timetable you I you’re all to seem at inflation that the the loosening have supply of areas XX exiting the year about and from can areas increase? As forward, And are becomes you talk know the But long-term talk

say the business Well, would getting I think, is certainly scale is Ross, board. across to the what I

margins as mix. in in really So increase of as the is forward the model result go a we long-term

businesses Center said and company. we’ve over to we can the XX% of Embedded that what believe the So get is Data

are of probably – to inflationary sort to Center, than grow costs rest expect on of ensure sitting and faster are of the we’re that the that some costs company, working drive now out Data XXs, in and kind trying will It low is margin there. expansion. particular, the all there We’re in right and we

We’re of working on on those Embedded to in well to back the a frankly businesses. than in Data minimum. expansion reductions trying margin Center us going time, growing we semiconductors of faster to all do work over the other sort And working the keep for cost primary as as is as but

Thank you.

Sure.

Thank you.

from Matt from coming Ramsay is question next Our Cowen.

live. Your line is now

had now. But to a be by growth thanks, afternoon a the about the strong partnership continue cloud. of very that much. very you down business. build Thank to continues Obviously, the Good the wanted Lisa, for you’ve engagements lot out business right to years. I driven that with is and the and server ask Laura, question

of over and I growth in look next, the were for share wireless diversify space Thanks. seeming color script on well? relationships X going the trying launch Server cloud. am of eight Ciena the enterprise to through give how we the you quickly to and roadmap with And to four, Bergamo not And just I preparing engagements the with is some your you talked mean gauge next are on six, As and the had in platform. year next I about top continued forward quarters. how business Genoa get some guys continued you going a how of as server diversification, wonder gains telco and just business some over grow Genoa the in in can the

Sure, Matt.

of continue earn share – to I we definitely, are we every that we and that going think amount to in there. love our the progress focus So we can cloud, making are

it side, a as always cycles enterprise because bit bit longer. sales said, a longer the the we On are have takes

all progress top of the very made have OEMs. nice with We

are the continuing portfolios to expand. think I

We are – our as the as Genoa for X high very current performance to as just telco. the that said, well a not we excited with but end portfolio about at as of just Ciena expand that portfolio, is you the broadens Genoa,

sell beyond. is to steadily there the share to is So, as continue our AMD we that think go the portfolio. in grow I expectation we And opportunity a broader as through XXXX well enterprise, and broader

have, assets Pensando us. for GPU center I business I of the think the in the as not and well CPU, Xilinx our to We growth just all data lead assets, portfolio, addition the overall think but the as the

Lisa. Thanks that for

have question my normally I a follow-up, but on it gotten it’s ask Devinder, last I would the As a hour. e-mails in few

a just cash So, only items maybe me free inventory up supply. pointed a a I the I little one-time figure the leverage tiny The it. up flow am bit forward. or revenue, through Xilinx, ahead people would And to wonder more the have expanding ask as with and go was obviously, the or so bit you. there very walk year-on-year, the are or few with wondering Thank variables on acquisitions, investments us up including I flow you flow XX% what free if could we that steps that cash where in very, I modestly. but cash go where out

can that. I Yes, do

I lot, think in working grows capital. needed a revenue the one investment is when is there

numbers capital working So, from up significantly an AR inventory are standpoint, they and year-on-year.

is We And that with Federal timing of does cash about from government. tax last asked mention the server QX, taxes will timing also the the of tax then timing of the business. the going cash QX. thing have the sometimes rate a Lisa have, the the And gain free cash the And of we I of growth cash about, from and significant supply taxes questions given up standpoint XX%. But payment as in we the get given that the discussion, And said was did for are payment payments shipments X% of supply have previously, some to paid. flow. you affect some overall share the a

standpoint, investments in that has flow cash because a impact prepayment free cash capacity free and from also obviously making funding that are accretion. an the the and We those suppliers, flows through the on flow require

investing really, for at inventory growth for it, is future. this look capacity investing So, and the you and if

Got for it. Investing Thanks it. very guys. much growth. Appreciate

you. Thank

from Rakers from coming is question Next Fargo. Aaron Wells

live. is now line Your

the center to go the But help largest to for Yes. I the a I we quarters, especially Thanks unit data you pricing congratulations. you could trends perspective maybe questions. are I blended at couple more. in there. unpack last I appreciate CPU a from server try bit what little that you question, competitor wish if of saw apologize for your to trajectory taking best. of us kind of this given the am the overall and I the business. last first seeing decline quarter, over my I curious Laura, look the your wanted at and within as guess continue business

move as Bergamo trying we XXXX. a should basis as to we CPUs? or into trend Genoa we on within the server appreciate How get blended into Just think ASP about the

Okay.

I is, guess Aaron, say So more there has than right. Milan, would content much Genoa I what

core Milan, get you processors. you to XX XXX If XX get core. Genoa And you Milan and into and as think it’s of Bergamo, are and Rome

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little So a of bit hopefully, you that gives color.

the quick just business. data GPU curious a am as I center follow-up, then And on Yes.

the You sell business curious talked that of I about kind broadly? in you plus CPU year? Frontier, more strategy Have you your about the where further am started Thank shape guys GPU traction expect ability to to see for out you. to

Yes.

data make the work with who The to product. So, us there we MIXXX large in some partnering to our have progress continue for is on the key very good GPU. hyperscalers closely us been center of with

those I think more engagements expect standpoint, in certainly, larger we into this from contributor sort a contributor some it of big a of revenue initial it’s to be production XXXX an overall engagements. But not turn year. would as

Thank you.

from Moore Stanley. coming next Morgan Our question Joe is from

live. Your line is now

constrained? at you Xilinx. first still of visibility obviously, next kind it’s of terms if those And situation you. I growing Thank business the nicely. constraints? relieving Where a little there could you part that Is into are of supply What’s Great. bit your to in talk wonder year?

Yes. Sure, Joe.

all well. would able has performed to really were in supply we into some And what portfolio improvements brought make Xilinx the chain. do The say business So, has actually, significant Xilinx across segments the been extremely strong. the as we that is I demand

step have And we up. seen a nice so

pro If about you Xilinx grew XX% which the were growth. forma sequentially, look is basis a nice to on portfolio very

constrained certain the come certain to And make bit the of year, continue we although year, XXXX. we supply good towards of areas, second progress. into As on, we the parts of portfolio, expect especially latter look half Xilinx the the additional are in I to still into part a

– view look – again, the of of the quality think the is business, the Our very design strong. the wins, overall quality of I diverse you market the when

for think those good the constraints growth trajectory so relieve continue half of year, business. are the into I as some of a supply I we think see able And to to the second

about And the then as of Great. generally a context competition couple in on Thank of in constrained, of years. X Intel follow-up and years – just last you. microprocessors the last you years, either how a been for couple Intel for or the for you has wondering – think you

here. you or changes, value-priced kind this you bit think utilization a anything pricing Thanks. As you talk and of those be Could about probably ease Do constraints obviously, Intel a falls what anticipate market? to continue wise? little does

we it market. Joe, always I mean think I very be going competitive it’s to Well, that – is assume a

little is bit talking are data attention center But that I have you on side, a the customers about depends ownership. factor first within think sort is what it cost really the of paying on total are market. not of It’s found pricing where the we to.

dollar of of is the power very there and performance important performance the and the the equation sort efficiency. sort per So,

PC we market we the As into PC on, segments. deliberately our have let’s premium the focused go market, more call it,

ultra-premium, low end. price again, very more about are end the as segments. reduce product. going as like are There the much sort think forward. the to sensitive, parts the we well said, high commercial have as as I And gaming the our market of of So, that I PC well like tried some exposure those And are there

the think a – I change So, don’t lot. think I dynamics

have think and key very I to it’s roadmap. thing very always there market competitive a the is a strong

Okay. Thank you.

Sure.

coming is question Jefferies. next Lipacis from from Your Mark

line Your now live. is

business to it the like the that two-thirds data like data guess that XXXX. of center Hi. a about in kind closely. be center if because like of had I outsized would share it you even the have that pro apples-to-apples from against a you Suresh gain from the am change hoping going that, Thanks And was for gain. of would if too. ever reported I been it’s wanted Xilinx, And about that that be part just from share Intel that’s QX, declining. would that are the guess, contribution of what follow-up, guys that’s business that business. like question. at Pensando in think that with and any Admittedly, make I guess service together, X.X% – And of things I that I share mid-XXs, interpretation center come am the data because like of share? Thanks. kind might spreadsheet there the right take pretty kind – us, contribution the curious more I back If you. math around that with highest to forma X% we my grouping from sent that I data put you It what taking first restated you in to something question. would would the Intel. a And on So, until, guys is about I aligns to could pretty since center your it you looks numbers. share look I the look Intel’s think back looks could to sounds gained you in and the looks that or that Xilinx jump or if big

Sure, Mark.

while. the sort have we is for that reason about so asking went know guys that you better this of was the to So, new been that there I visibility. segments a

is of gaining your share. code our the are pleased that ZIP math from think point we we are I And in view. So,

the was your I will no expectation instances continue going we as think across customer forward. would question, share To on the there see portfolio expands, to product focus that outsized that was more gains. as we that as that we we was our And set supply, increase ramp contribution.

of other The that it driven it segment small, by relatively and the as primarily pieces are you are state. EPYC was in

to like come then the that get customers. may. the I cloud the And from you to your And like Great. kind variance the Okay. am I on wanted this business. about if just visibility of follow-up, I back wondering

six since is, that’s you sign do months they coming visibility that say, We central and is to you guys? center their need consistent Thank and curious give So, you And cloud to six guess this about business. in on of how how cloud, is that, the these lease had. I they the center they lot imagine after come of lot months. get the I and a I their scenario do online. – built I tight from do data you. span it guys to is around that’s am variance a they in to data all going Do how And they the that hey, chips get a companies the kind planning of

we our actually been about helpful. I out it is that doing and think have XXXX, that frankly, jointly helpful. there. very with enough the ensuring has conversation Mark, Much has Yes. the are planning of very are customers mean been now, I capacity we our that right build-outs for of some

the the how have frankly, few active conversations. overall, is much And visibility how there of I for minus there. So, here very active and But more are the codes things months. very I And would say think or conversations good. obviously, ZIP plus can been content customers much past growth, change, the need

supply well. get chain I as recognition need that is the factory match get and think the can so their for they of we of planning sort capacity their gone line a positive get is can that in new of we sets our stuff through there have one that the capacity they factory long-term can all and

overall, visibility. So, good very

Kevin, time questions, Mark. have for you, please. more we Thank two

Certainly.

is Sur coming question from next Our from Harlan JPMorgan.

Your line is now live.

congratulations and and afternoon results Good the on execution. solid

XX-plus around cloud, kind On has of SKUs half year, next and of I early the their a ramp team back of embedded of the year, this Genoa believe customers. enterprise total across

these I asking cloud out that its high-volume competitor executing struggling to releases, make Your the because, anxiously and first? you to SKU customers. what’s want is is platforms. with your obviously, look qualification cloud high-volume rolling SKUs SKUs? on And sure be cloud your these your are like just Just team awaiting AMD SKUs releasing and high-volume the customers obviously Would

Harlan. Sure,

our go full, with So, interlock a we certainly again, through customers.

a cloud the of what there again, is fairly SKUs, high-volume cycle that’s enterprise From Our enterprise. the as on in pull strong focus of the there today, is SKUs lengthy on customer high-volume qualification both we actually because and Genoa. see sort is sort a the cloud as well

the year. and closely production to different different engagement and so ramp And our fourth next we of different first so working it quarter what forth. are on by But be into will then so a seeing very And strong we with we customers the customers. expect of platforms lot in and is our and and customers, are with half

you, Lisa. Thank Prefect.

Harlan. Thanks

Thank you.

today from coming Our from final Timothy question Arcuri UBS. is

Your line is live. now

lot. seems it if you pretty take line. to the Thanks just you it like of by center like the of and but ASP, multiply wanted in It $XXX full million, seem you data TAM. costs weaker keeping lost kept And PC in the you you on seems the a guidance year. sort units full maybe maybe year I Lisa, light double click

better that the And is that So, a Xilinx? story? then really at you really the are getting offset I follow-up. have Is Thanks. supply

that, everything say would I year beginning to again, put whenever the the full wouldn’t especially guidance so. of What not Yes. is is No, that, together Tim. say from we going year, that we I understand be exactly

of data the we And expect center to year, again, So, grow as will half second extent, are half well. the we as look Embedded/Xilinx what to data seeing now half consoles into to second the is some Again, is, second center first half. first also grow half also will grow nicely. we strong. to

offsets those are fourth coming reminder, at think look will quarter we as is sequential believe perhaps in a think that, quarter. components of we And the a that just again, number have in I so offsetting out growth And a do in as PC and conservative that drive of more fourth what the nicely. that product we we sort the X-nanometer, outlook, ramps

year the those and think guide. of are takes puts some I in So, the full

guess purchase maybe and big increase free was pretty I Devinder, am purchase Awesome. about I question flow, is on if you. thing, talk then cash in commitments? There And commitments. last a Thank can you a wondering there

I talk that. Thanks. wonder if about So, you can

in wasn’t in cash to but Financial step all it the bit, step does In this year, given that to we $X does paid. get had does I billion first up the as the half, and half. And XXXX. think for it the ready on need second I flow. said that up about significant, flow so the free it committed especially XXXX, Day, And little we a supply

from that So, impact it standpoint. will that

Thank you. We session. question-and-answer would comments. of further reached end like closing or back our over the I any for turn to floor

Thank for you, today’s your earnings participation call. everyone, in

Thank good Everybody, always, have we our company. support a of you. As appreciate your afternoon.

today’s does conclude Thank you. teleconference. That

time, We You you may disconnect today. your wonderful this and your thank line participation have at day. a for