Advanced Micro Devices (AMD) 2 Nov 222022 Q3 Earnings call transcript

Hello. And welcome to the AMD Third Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. [Operator Instructions] A question-and-answer session will follow the formal presentation.

As a reminder, this conference is being recorded. to call pleasure Cotter. to my now turn over the Ruth It’s go Ruth. Please ahead,

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

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

are and non-GAAP replayed in non-GAAP Chair President and and call Lisa refer webcast measures website. during via call on release full This primarily today’s The Chief Vice Devinder available are Officer to Financial Participants financial Executive which on live to and Treasurer. will posted reconciliations on our Dr. Officer; We Su, our Chief call. is GAAP mentioned. are Executive be Kumar, amd.com slides, press this will as conference our a and and today’s

differ factors statement the beliefs, information more that from statements involve to today, to to press that and cause our the and fourth speak Engineering, at December Before risks discussion to could Summit of like refer assumptions as time current we contains Chief close our note actual and our Media November Please the cautionary and Technology on expected to and is on forward-looking materially Friday, differ could Papermaster, based results quiet the today, business President, Telecommunications only Wednesday, release current results Officer materially. on actual XXth. such, expectations, XXth. expectations. I begin will on Fargo Technology, Vice and as And Mark quarter Today’s of Technology in Wells uncertainties cause for that attend begin would Executive

Lisa? the like call I’d to Lisa. that, with Now to over hand

you, Ruth, listening to today. and those Thank all in afternoon good

substantial revenue each significant in XX% expectations. the and supply $X.X gross year-over-year backdrop, below overall billion and as across reduction PC to due year-over-year softening Center, revenue our grew Gaming demand line macro quarter PC delivered chain. segments, growth in came Despite Embedded our expectations our inventory Data margin and with actions third Our the to and performed

and We year-over-year, the business. net grew gross also strength expanded of margin highlighting our income

Turning to Data new down third-gen than We processors and and and as select based power X% our issues quarter Tencent, initial multiple macro segment. EPYC were of year-over-year internal XXth their and than doubled scale load Baidu on to by $X.X increased Revenue OEM Cloud sequentially with XX% OEMs enterprise, our our CPU or EPYC Center to the set starting of results, year-over-year working of server their others to processors the as revenue sequentially strong sequentially sales, through by Azure was more In record match next-generation deployments continued the XX Genoa revenue processor business the delivered for Amazon, demand launched properties in expanded business billion. hyperscalers Microsoft increased pace and more some shipments quarter. AMD of straight driven customers. and instances purchases and server uncertainties.

highest which landscape, advantages enterprise to next-generation competitive TCO that lead extend third-gen in xXX energy further broader the for available, most EPYC the our CPUs and and Genoa Looking expect our and significant efficient both we CPUs today server at X-nanometer with and are efficiency workloads. performance, processors, performance market energy deliver hyperscale

and Super initial and the to Enterprise, platforms will processor ramping deployments are next others. EPYC support of Lenovo, cloud introduction Micro production by Dell, week Genoa We launch publicly HP and fourth-gen

a enablement the of member providers of led prior as exascale of by standards products shipments quarter. Pensando and progress and to as adoption. strong from work and DPU role of approach quarter. acquisition few we The Foundation. the made SmartNIC Center very VMware’s cloud broader founding customer customers the our customers. from drive GPU virtualization for platform pipeline we popular our Demand working product Looking to year supporting addition with largest at Pensando Data was expected, as Data We supercomputer. the build-out the received the a had our its launch a Frontier cloud record the Data portfolio, based look good adaptive, quarter, enterprise our of Center significantly since cloud highlighted when had DPUs Data development in DPUs Center excited our FPGA of has support ramped software GPU the portfolio been sales software networking our significantly our Center were our of next-generation financial quarter during by sales PyTorch from the closely down We driven were announcing substantial in closed. ago Center Data Sales the We PyTorch with months Xilinx to forward in the doubling well including learning by demand to products from framework. deep customers, cloud also We by

solutions, well will solutions and Our and the portfolio and make us VMware Pensando that product CPU With significant validated by for supporting optimized XXX first others, included been position HCI CPUs, as our to based track and broad has and expanded long-term the per processors. We DPUs telco server GPUs, virtualization we edge Bergamo on Bergamo in DPUs. SoCs strong to we Bergamo have will with secure growth Data Data We and of Centers Xilinx our gains compatibility optimized and Data cores Customer offerings our family the end the with the on powered Taking addition threads much XXXX energy momentum our our features business leadership our very our XXX we map delivers. easier more first back, industry-leading it adaptive socket, Center. have believe and and share new and workloads. expect response road further and to a our will our in enterprise cloud performance, the Siena of capabilities expand consistently from launches products portfolio. Pensando in software customers performance for server the be build cloud and remain performance step DPUs leadership Dell, HPE executed Center in FPGAs, in of efficiency built

Now into XX% Revenue declined segment. our Client billion. year-over-year $X to

by delivering Our from Ryzen gaming, Client our processor creation increased productivity our consumption Series as the third demand shipments quarter Ryzen prior based XXXX applications. X-nanometer closely customers the performance in we our and our channel XXXX Series quarter, We CPUs launched inventory. were Desktop reduce below XXXX for with in PC downstream processors and sell-through leadership worked driven September. increased the in Series content and Ryzen strong launch reviews on platform of AMX processors with to

sales this quarter of broader to the range CPU expect We a Ryzen aligned mainstream and of launches ramp with motherboards. enthusiast XXXX AMX

offset XX% We consoles and downstream for and segment, graphics revenue semi-custom the sixth strong, to prepare the increased as semi-custom as demand demand game SoC based on sales Sony of gaming GPU the soft focus for Microsoft and declined Now consumer turning graphics. inventory. Gaming billion to $X.X reducing decline delivered our holiday sales on year-over-year our strong a quarter our remained in latest revenue in season. straight Gaming quarter record

designs. this GPUs X-nanometer that RDNA next-generation combine advanced our graphics architecture most our week gaming later X launch will chiplet We with

current and resolution, per performance GPUs We and end RDNA features watt deliver X details more our include performance increases supporting to frame later rate look strong in high products this to gaming. will forward high compared Our new high sharing week.

core high who by billion, segment, significantly products their communications enable revenue to capabilities products. increasingly aerospace We sales particular additional driven our leverage North was our Record Embedded communications supply strong infrastructure features Longer growth aerospace by from Overall emulation and remained from wireless term, defense $X.X customers. markets We and opportunities and with a we in record automotive, our wired XG quarter using are demand. We led business. products and demand the to to about year-over-year our across strong. a and and at very deployments. we and design defense, in address new defense strength Xilinx the and closed continue prototyping, communications and our saw customers. adaptive automotive AMD’s industrial growth for customers networking, revenue wired had scale SoC this driven in to in as and America growth Demand multiple remain very to increased revenue aerospace excited and Looking differentiated are secure wireless both to record expanded customers. installations FPGA Embedded market wins by

portfolio, Embedded of current and deeper In strong Center leadership product adaptive opportunities based GPU growth win with the many summary, segments. dynamics to our product on and Embedded Data on the design engagements of navigate our new expanded in customers seeing our portfolio. well-positioned and DPU breadth market and CPU, SoC, based our FPGA, balance are also sheet we are We

have We guiding us. clear priorities three

and generation road foremost, First we and maps products. delivering our are our on focused of next leadership executing

we fundamental building Second, AMD in we how we manage of our even their enabler make a business. we very relationships the are And remain customers deeper disciplined success. lastly, as with

strong high intelligent cloud, outlook. the The backdrop remain unchanged adaptive end with the We increased around across aligning our secular supply growth. Center, will performance long-term continue business the the to the while and markets, Commercial trends devices and edge for Data and a the and provide demand chain priorities driving across demand tightening in at computing in invest for our of strategic rest Embedded current expenses and

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

reported line preliminary and announced afternoon, good you, Thank Lisa, everyone. we in results results with quarter the last month. third AMD

Gaming also of Client grew of While revenue. our lower our performance segment Data expected than significantly pleased year-over-year, and the each results quarter Center, third we are Embedded with segments, reflect which

year year Data ago. up were company. XX% from charges Client compared segments, scale basis continue million to operating $XXX was margin. Client margin client partially offset billion ago segment inventory, revenue year the up year revenue expenses. ago, as pricing and $X.X revenue. quarter ago, income XX%, billion, higher billion, XX% higher Center $X.X a higher primarily in per per was gross in ago. was Net primarily we $X.XX year to and from to the XX% share the Operating Embedded per XXX related businesses. of and a to expenses points driven by Third million was driven and year Earnings a graphics $X.X $X.XX compared lower by share, a growth due up ago lower from due ago, share billion, from revenue $X.X $X Operating and was to was income to revenue a up compared billion, year XX%, by a to margin Operating a $XXX Gross

Gaming Center Data segment, by with growth partially revenue, of $XXX PC ago. Center to or up shipments revenue. to year was year driven Embedded operating revenue. in billion Higher and revenue sales, inventory revenue XX% operating was turning billion, lower higher ago, and by year decrease XX% chain. to expenses. operating $X.X year due $XXX inventory by was revenue revenue, EPYC XX% to income partially XX% year-over-year, by Client revenue, segment $X.X revenue million million XX% $X was was ago, to segment Gaming operating The year a of XX% revenue. driven was inclusion the to compared million a was offset Embedded Now $XXX a lower billion, due or resulting to driven driven million $XXX revenue income loss product revenue. due graphics higher PC a by Xilinx’s strong the correction up income revenue billion, segment our or of or a across a segments. billion, was offset semi-custom the or process primarily ago, million $XX up million revenue, pricing charges. Data product compared was server ago. down weak from primarily third-generation of revenue. income income related reportable $XXX operating of Starting significant or a reduced operating million, $XXX XX% million year-over-year, to processor by market primarily to gaming lower XX% from stronger was Client and embedded year-over-year, supply compared higher XX% compared or X% primarily primarily due operating of $X.X $XX graphics $X.X

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

common senior the $XXX that million During the August to totaling repaid repurchase matured and X.X% we in $XXX deployed quarter, notes million stock.

approximately We $XXX Inventory was last primarily and for million the of Cash remaining free up have ramping year. billion, operations compared year. quarter, second new client $XXX the half million and driven authorization in quarter same from million in products $X.X $X.X was was $XXX cash in billion the prior repurchases. stock to million, from flow $XXX the products by

outlook contemplates financial our to environment. turning is Now near-term outlook, and current expectations macroeconomic based the today’s on

segments, approximately growth is and fourth the or million, increase XXXX, quarter plus partially revenue of expect and flat to by we Data by a expected an Client Center Center decline of year-over-year Gaming $XXX The year-over-year Data XX% the in Embedded segments. and minus $X.X the On approximately For offset and driven sequential basis, Gaming offset and to grow, be declines by Client a Embedded segments sequentially. are in billion, segments.

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

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

expect focus to our conditions. on XX%. We executing current approximately non-GAAP to continue strategy, navigating gross In while market long-term closing, margin we be

growth, investments to prioritize with headcount for turn that, and managing Ruth inventory operating controlling session. cost roadmaps actions, including With revenue management several the key near-term for expectations. line in will taking prudently product and me actively Q&A over while We expenses our while let our the call Ruth? our growth, long-term

audience Kevin, please Devinder. if for could you, poll Thank you questions. the

today from Fargo. question Aaron Rakers coming Wells first from Our Instructions] [Operator Certainly. is

live. now Your line is

think taking your digestion your have of one inventory at quarter of through thinking December for in and full market being I you of I business out the kind we you a the expectation quarter, curious of question about customers. the thoughts guys? am as as or down bottom piece inventory, out clearing follow-up. the in any of PC just guess, of of question. we PCU -- reflection do Client of I quick Thanks of are look the at we coming just current kind one find work that kind the that you for Yeah. how sequentially inventory

question. Thanks Sure, Yeah. Aaron. for the

us PC for clearly, in So,X business very and been third has volatile the underperformed the quarter.

the We monitor into will the in is are better that, inventory the that that I the be think between a significant step will embedded guidance as and PCs our in down again go quarter, the fourth of year clearing it’s be fourth exit but will we quarter, we macro -- that, course, in quarter. guiding we place. and believe third conditions, we quarter the fourth certainly a in will

two? quarter look ability Yeah. And shift constrained. we server supply have I curious the on especially side on about in ramp as think, your if have towards then the service you as the or past, supply business, a general update you am of quick in the processor to somewhat I talked the next the in an just being situation follow-up the CPU,

Sure. Yeah.

-- have ramping in certainly the on So been overall our supply. up we the server side,

have that progress the throughout on I year. made good think we

in the we fourth We are QX in year than some of supply in coming investments have online those earlier quarter. had the and here more

we Genoa expect as be into not the with So supply launch based go see. on XXXX what we we constrained currently to

Fair you. Yeah. enough. Thank

Thanks.

you. Thank

coming Next Toshiya Goldman question Sachs. from Hari is from

Your live. line is now

you the new I be given are versus of outlook positives How question on as from the in early that that are place which for for the or given optimistic and to too it’s to server but cloud macro, headwind? much to the side taking many range, in business what well kind so just given business. you a XX% difficult to to continues thinking Center the there I CPU about know enterprise the have you is of your the XXXX, made, fair that think little you wanted us Data customers, the the ramp ask is I today? supply a question. of side, both predict, XX% on growing Lisa, products. your be what hearing as a in a know comment the Thanks specifically and

Yeah.

little today. about Data precisely. backdrop to early me a where give is a it see So we maybe But talk of the you bit market XXXX let Center

there said, all including the Data some markets, in are are macro market. near-term, headwinds affecting you the overall As that Center

is I the varies the and market AMD is of each the this segments Data America by and Now the it segments, of strongest. cloud segment, out so we through the go resilient are is, is seeing within if think Center probably, North what where I most

to have continue call of, individual at medium-term. individual some let’s vendors the and vendors let’s efficiencies it, be it, may at cloud very cloud North We footprints had although we near-term, call America the that good believe there and optimization progress over

we moving just portfolio, to Genoa AMD, into in As of product we more our particularly customers market, go overall, expect the XXXX, strength given workloads growth that forward. and coming

other through As recovery weak are in XXXX. forecasting been has XXXX China significant we the very not in is look a I we -- and segments, think,

will And enterprise by see probably side, how say, impacted I macro. most we that the on is goes. So the then enterprise would

bit have feel good product gain to That perhaps conservative about our business. CapEx. very that said, seen taking good of feel market make value proposition, in share that bit longer we our can portfolio, more about believe, customers across we a decisions on we even So and a and little we very though, being choppy a being little we

think, need to everyone overall, trends through Data are our we as does. So, macro and Center work I the good

for margins, follow-up, helpful. then as gross my a That’s And question Devinder. on maybe

you Data and were Center then, is about Client guiding is points basis the significantly, margins which see, in very XXX is are to your resilient so business. Xilinx you QX, good classic business up down where are gross but you obviously, since points, QX and is So below XXX basis still

you perspective, place. gross margins else? you. QX, down be mix recognizing versus Thank QX, inventory I or are it hit is in a in should a from What’s something better you guess, So driving another

first inventory No hit, of all, Toshi.

QX PC to On margins you the weak the XX% if Client as is coming gross XX%, the you said, down. QX way primarily go and margin, market all

For and example, if expectations lower. other businesses you in look line QX, in came with Client margins at all were

weighted, a lower the ASPs. Center, We which cloud in have place also Data has

some the Lisa margins. baked supply So XX% the that additional capacity an as guidance. QX and earlier, that those costs on all from has from in the into there of new are then a have we agreements And some are margin also impact mentioned supply capacity standpoint,

Thank you.

Thank is Bernstein Rasgon you. The next question Stacy Research. from coming from

now is live. line Your

Hi, guys. Thanks for taking my questions.

extra For to the any driving wanted the in material don’t is know Is those well is? -- QX. specifically, that on particularly an as ask there any there first about week linear much one, as from extra overall revenue was of that basis, Center I how week? in Data business How sort -- impact I there is that --

on week. Yeah. not extra Stacy, we impact are a really the counting from material

the extra look if and material holidays in Center, I the pluses PCs place, Embedded is the The -- but again, with we really of not are think there. higher, you is and, counting Center guidance it, expecting much the those And sort that and we let’s around all for Data week lower, being Gaming are has too at are minuses a Data QX impact. -- call not on are quarter. then in

you. Got Thank it.

impact what QX Client expecting pricing in sounds margins pricing you you know there’s pricing as units to and know wanted QX? I but are like a has pricing in and well, are a did I Client QX versus and and follow-up, like do coming in if or impact I about in mentioned just don’t cost my in QX, if down. are it that’s an you what units suggesting For ask QX. specifically

Stacy. Sure,

you think it third look -- there in I quarter, lot So business. a at are was of Client dynamics if the the

a So market consumer. footprint consumer of particular, was In was and weak weak. have we more in

a saw down, ASPs we basis. units framework, in we come that down So sequential on saw come also but

basis. will Now I up still that a say year-over-year ASPs were on

we quarter, been, let’s it, dynamics pricing of watching this We couldn’t have continue we to some So environment. pricing in sort face will in the unprofitable space. and be call that see business we and disciplined did

quarter, was the Client the weakness to think, that and that’s into relates minuses we again, or given forecasting the fourth competitive are So we guide. as I go embedded And for market in pluses it a environment the ASPs. as

Got it. Thank That’s helpful. you, guys.

Thank you.

Arya from Vivek of from coming Bank is question America. Next

Your is live. line now

for question. taking my Thanks

because question I what rate, look And any we do I X% TAM one, that to bigger client revenue X%, what first PC -- you or your the to year in a clarify AMD billion there? get what think for QX, What $X seems the bit I optimistic. kind the for sense a back from $X.X competitor was wanted the to is then, TAM kind mind should next million, down about do of which And so billion? recovery de-risk year get PC for this model a you is, is For the only $XXX next little client of it be suggesting Lisa, you is is have the $XXX just like, would guess, thinking be there how quarterly get does does PC asked that AMD perspective? million, help that we do

Yeah.

So, a of Vivek. points, couple different

let’s are in of and and sort to what would in we are situation call QX. do it, low sort already around for correct Client fourth to me answer off expectations do a base inventory modestly again under guiding, the to We ship to going say, the a as coming that just possible, result, we Gaming, as the consumption want quarter are QX. that. Let quickly obviously, is I the we down the as of of and

this As year quite let’s think, a of factors. will close high-teens, to a next it relates PCs it, call XX%. mean bit, I to down there be are lot year, I

is mid-single year, the think, calling digits. we As go I into industry next

be I good a would think case. that

I very have portfolio within through I should overall. model good very I again, about feel about very our and product we minus this to we And get platforms products, inventory think PC expect and business, XX%. we as our mean, good down good our correction, we

will but the have these the through think PC as go so. will we So or work do into I business quarter we to next recover XXXX, dynamics over

for my are And actions be, recoverable help taking of margins So taking how and how basically that the XX%? QX, do can longer Devinder, of much much the they took that trend are don’t actions Understood. prior you much QX in how can start really revenue, and trajectory? let’s you prior term to margins, target are the on revenues you how -- maybe write-offs there get that revenue in much, for XX% is recoverable gross gross in margin getting one Thank say, you you and QX? is are same as back because follow-up, of that pricing QX So gross hypothetically, QX if back what the grow the you. to margin, gross actions are your Client in over

to this it Let me way. try answer

which inventory came margin. about gross $XXX had of and at and QX XX% are with in you we itself, of look We pricing charges, in million If charges. related

If the the the Client had obviously, you are Client -- those, market, to XX%, for primarily, You for weak we to at due and came have XX%, in is right? XX%. about PC margin two we reasons, guided And that’s QX adjust and down. margins in

for the of the will earlier, said I perform expectations. the As business rest

it the from products introducing, then I and We feel back and we increase and on market PC are and the over products perhaps early have the through where we especially margins. XXXX about we taking do talk guiding going quarter new are this what’s come the ability with quarter, to the now, maybe up then margins from next right XX% and about work there. good to

really But $XXX million is I that’s the question? guess recoverable, my

actions inventory pricing Those Largely, recoverable, rights say, would we or asking. that’s not would take. are if mostly you were I what

to you then I you would actions a these expect XX% mean QX, higher like, QX? I at be you get in should normalized, you QX gross if can margin have take that been don’t versus in the back

that the will QX, say from I we improve in have we XX% I there. won’t what but QX, is can from guide

Thank you.

Thank you.

Next coming from is Cowen. from question Matt Ramsay

live. Your line now is

At you. Thank Center one Very least afternoon. Good and on have follow-up on a Data then segment much. the question Client. I

On to look pre-announcement the back a ago. the if Center you business, Data month

I in modeling, under there maybe a little will bit where I say came little we was were way. a of that think, -- you bit just

comments about I still And got doubled and year-over-year, ton script interested that of than maybe right. just you how questions that And made anyway, the help some a in I so that and you cloud your revenue was more really got in could of I on that confirming if both us a called little expect would given we HPC, and the bit I cloud clearly headwinds break CapEx from obviously Data down that GPU. Center heard, enterprise your in continue were the strength business some there between commentary you from CPU to have on but and out that

that, where strong the to that was helpful I down, because as as you. was cloud given just in, in came surprised the was numbers revenue that be I Thank it would think So break quarter. it

Yeah. Sure, Matt.

a enterprise wasn’t because GPU did cloud we revenue on of margin was But quite focus have strong downward for bit of then third it the say grow. And dynamics there tends down as on that revenue would XXXX, few are goal down. right I the have footprint the that And our quarter continue expanding margin. good on perhaps, a had over we quarter and the weighted we in coming So -- mention, more the more are, next quarter, to double, in positioned becomes solutions go third been is, weighted, out side, what your we across than modeling. was -- and the too, larger there as CapEx will in being to more pull business feel North impact our market the our just of that Center everyone footprint some we the in market I But best That and now OEM will business I that, share spending. the all really cloud earlier, little though. There enterprise. is macro, our is there even the think think so platform little of is of I very out the all we is questions, with Data bit mean enterprise are is probably case, a weak and how segments. good that that as on back expect aware I cloud quarters, and the the America of cloud partners. a said say as forward a becomes is about cloud to I few I will pressure

get I a a term think gain continue basis, the to should think portfolio think, quarter-by-quarter not capabilities model longer product right, I you may us basis, help the share. the on and on So I product exactly but

Lisa. That’s helpful. you, Thank Okay.

how I until highlight there, my guess sort you as guys think changed and quickly market kind momentum there of partners? you or guess Any of see inventory But whatnot. be last in three very the the It’s I business monitoring much. four dynamic Just any you the super levels the learned in really continuing. I from I out real that cloud follow-up, PC we how just of I protect guess, of wanted what making months over to months Thanks and out forward? market. have and, about is, I to the the did times have the quickly question revisit thinking obviously, to changes went things or of really, when corrections thing going guess, sort this inventory the back color when you operationally kind coming to the in working this how and guidance, would beginning changes obviously, with original And you make was progressed down, pre-announcement. guided helpful. from of guys demand through you coming really thinking about back dynamics wanted August walk guys are at quarter the might kind from are just gave there of channel to the your I of

Sure, Matt.

yes, third the volatile. So, market was the very quarter, PC

is we Going we market would weighted. market consumer weakest into of it, heavily where It was portion the weak. expected we and a the tend to expected than more weaker the be be market

Board the in also become saw customers the the is, we think just we cautious. across macro I thing have in that the -- economy has market overall perhaps more weakened, as general

their a coming So stock been the as And a were constrained where first were we inventory replenishing the supply/demand even frankly, in actually supply not trying were year, levels. situation. they imbalance we half to to gather same the and of of inventory, in selling off they people had were through

So situation, I it a very is say. would dynamic

have I think chain. we that the the great supply have. partnerships across that visibility feel we good I about

market situation. I factors to better continue reducing all market sort to are But that towards the so the can we levels -- will of biased the react market we will be volatile. and we inventory think

little So, a hopefully, helps that bit.

Definitely No. Yeah. that appreciate Lisa.

you. Thank

Next today Joe Morgan from coming Moore from question is Stanley.

live. now Your line is

markets Great. into if feel next to a broader of Thank in long I business can how visibility extent visibility it’s you. about about year? there, wonder you have the Like bit that part kind in of the talk talk your weakening your we but little okay. you growth there, here the Xilinx and you seen could about how some just generally, extends

Joe. Absolutely, Yeah.

has business Embedded our business, Xilinx been the well. performing just So extremely

quarter we QX strong in fourth very have and we growth see quarter. the into -- Another

very We happening on the have various what’s been sub-segments. within focused

is part business, know, of you the very -- has the nice broad as it that, based. it’s think I

seen was of strong, some have also us we up for see in automotive industrial. sub-segments There us, for up We was So the third defense quarter. some did weaknesses. here very weak. aerospace and communications was was Consumer

measurement quarter. third the weaker in and test was So

see and visibility. So takes we puts there. business has say, But do overall, would strong I the the

nodes are the We in constrained some supply still and nodes. of certain legacy

progress supply. of on lot a made have We

seeing in So leads us in additional QX. supply come good we are and to in that confidence QX

half, first given of I it very watching strong would have share overall, carefully. say, portfolio also and multiple we We that be visibility and business lead the times some we is we just the in well. quarters products expect But the that as will again, business in have gained

much. Great. Thank you very

Thanks.

Thank you.

is today from coming question Ross Next Bank. Deutsche Seymore from

Your live. now line is

thanks. Everybody,

down of a because segments, been fourth modestly Center questions So Embedded, of color, over Can I guess, the give Client and could here. similar the ask let just between us and talked me volatility about last Gaming. Data couple for quickly if a you huge color the you Lisa, in relatively quarter little couple give obviously, being, quarters? you has

level, are QX, QX an X.X Ross. flattish -- from we Well, about absolute since talking to Sure, Yeah. X.XX. versus on

same. of expect new offset are peak. we would occurring to is in it’s down Data that which Embedded, off relates our And by QX, launch consoles So few modest the the coming Within to decline Gaming, quarter Gaming. Center given weeks. Client in and a in That’s and is their be they bit fourth graphics the next as then about it

modest forward. as Let’s go plus we call it,

than well. Embedded, dynamics earlier, enterprise. cloud modestly were we again and supply, be to we some the stronger asking That’s margin as expect up that get more of as We

And then Great. for one you my follow-up, Devinder. either or perfect. That’s as

to market how, spend, your for guys next execute those Analyst against great share, continue about and desire put we model do laid you well, As buffers if have you other, balance stick so, most out the how are of products desire Day think to to gain continue at to do confliction? that recent conflicting the so philosophically new versus out that your the and business OpEx year, done kind you that to reconcile you each

Yeah.

especially business earlier in to taking areas have I the is terms I the the environment we roadmaps. in Data macro what key and rest invest weakened thing actions PCs expenses besides strategic the think are and continue in soft and The and about the focus in reduce hiring. to Embedded the talked areas, down has product of we we of slowed Center of

the out what are going out more of QX, right, it into XXXX, with take as do. we high, revenue the balance are are we that you expect and Expense in very time. is in with at look time comes in in we EXR So we business the you go disciplined actions and in if EXR but manage line revenue we kick terms to to do

Yeah. maybe, add And Ross, that. if I’d top just of on

have multiple have levers we think OpEx. I in -- the opportunity we

case, are commercial Center, markets. our disciplined, around Data strategic very said. I going being That about and Embedded we Devinder the to good we as mean, be direction feel very the So

So we want consumer to we XXXX. business our facing continue to how invest there where manage we will that’s and be the through more conservative of portions will on

Thank you.

Next is from coming BMO. from question Srivastava Ambrish

is live. line now Your

dynamic to to much. reported such your the There’s in guide and time. is don’t is kind of their Intel be Intel questions in been usually Hi. to so seems myself. back XQ of guided lot big PC pricing Thank to there longer to also things disparity. what Just specific what was wanted help a wanted XQ, business. I I pull-in understand raising you understand, Lisa, normalize versus some they a XQ AMD of over of And demand? very period between to case that come ahead disparity and and to us medicine it took they versus just guiding or are over and continued I ship understand a have But I a of a there that. earlier getting

help would be very So any helpful?

our are think, with we Ambrish. first the the the were Sure, third right? for that PC we way, a I higher third and by Look, half year, fourth sort let the Yeah. and our what than customers, and Usually, in that’s we the is I together the seasonally exited me first quarter half, again, were business, as reasonable of with to, the for on the our So building expectation. business, half. quarter second of so higher, comment a planning think, market

overall to were you dynamics behave really our as we differently bit inventory I customers just as work the of dynamics. temporal are and and caused said, corrections. weakness, the And market there required think just as aware sort caution some us those that in temporal the of a well the on environment with to together people

aggressive there chose follow, is some don’t as be temporal and fundamental. not are that anything again, are, think optimization pricing that’s very Some we of it sort a to of I others might there’s we made. And people expect, doing. that that -- very decision you might

think our strong. is I product fundamentally, portfolio

I it’s think will in that but will work environment agree we messy have to have we place through work platforms and market I a through that very work of through, we it. fully this. good kind we

Thank And Good. it. you. follow-up Devinder. I had Got you, for a

the through about or capacity. quarters the go a going to desire the PC you we Day talk -- the there capacity to Thank free capacity at the had about side less off up secure foundries at Analyst and flow need than the opening plus few much as as that’s you Is conversation this temper of remainder couple of available, we need that on cash needed you. should what your be Just off should given ago? to more headwind next quarters taper now

service were in on, business. earlier especially are Yeah. space, put Lisa the I we to working some talked place mean long-term as which have the the the that in support we capacity these agreement of benefit, about agreements growth

we given the work of ramp backdrop, actively Given market suppliers we do timing aligning market. in are our with up supply able the to something products with our to revenue suppliers and and what’s with happened that’s that

So, is some to overall next the through over quarter three there we --- two quarters. flexibility work that’s from will standpoint that something and

you. Thank

is question JPMorgan. Sur from Next Harlan from coming

Your line live. is now

continues on customers afternoon. cloud is to up In It ramp generation carrying momentum seems compute Good for my Milan. expand your your Center, through the of team Data Genoa the fourth with taking the Thanks question. instances like number of the platforms.

visibility is a I good very have dynamic. here. guys good you this I think assume

next ramp? into Genoa long and momentum expect qualifying year into does already you when how cloud do and continue high-volume So to your Milan Genoa start kick customers the are to

Thanks the Yeah. Harlan. question, for

yes, workload very So, with we look, Milan happy of sort are our ramp.

well. continuing and Milan ramp year are next into to this We as here year then

As we the is did shipments quarter. fourth to it quarter. start in relates in third to That of Genoa, initial customers the our Genoa strategic continuing

fourth platform. how lot are to production new here quarter. first new A some what bit takes and the given let’s Milan call have of said just competitive is that and actually people being for are before into both quarter longer ramping for that, the, qualified first the time, qualifications in we instances are quarter. the it, to the is Genoa fourth And a the we It So qualify. or in and coexist a Genoa are. X.X, quite DDRX going is PCIe

So planning how are expect to ramp continue business. to we we would both XXXX the that’s in and

your optimization, of mean, growth compute near-term growing macro assume workload growth you these year-over-year rates North cloud strong and are as services some storage despite concerns, of XX% networking, workloads customers, their American I Thank at mentioned, still they that Great. a the And types cloud and you. business strong or consumption rate and like I XX%, all capacity. in more share driving sort the build of to with lineup to Genoa need more installed segment team’s this this of and strong therefore, compute quite product mid-term both? continuing is utilization, a what’s greater this capture driving for your the Is out it compute function like, is or strong outlook the

power each it But say, Yeah. of let’s very more is there and I they near-term, efficiency, compute a also it, for in need additional optimization given both said you power is of, workloads our it’s compute, cost have products are upgrade bit And new energy the given building would us is more the call for what and bit around compute. little that our vendor older the It’s doing. a the of In is TCO, cloud Right. Harlan, of little world. very the strong out. well. think I medium-term, customers telling

AMD for we a in the XXXX. the as actually cloud also go of driver into We be seeing that some to are conversion

Thank you, Lisa.

Thanks, Harlan.

you. Thank

Next Danely from question Chris from Citi. is coming

line now live. Your is

you. Thank

for So the just or say, just macro of in the can XX your and next you it, out notebook go so? through if take let’s months share we expectations desktop, server,

of I Let’s to take the do macro am how it. think trying see, I out

So the your are actual TAM just talk standpoint, about put we -- and where that your going aside question question? share is a from is

Yeah.

can or You more you expect where relatively gain to say less.

I got got I it. it.

Data want let’s the Center. to start responsive I with the be Yeah. question. to Okay. Well,

I think Center, continue share. the will we gain to believe that Data in we

to expect and in We cloud both to enterprise. gain share continue

to so, questions, our based see a we cloud, few focus key that’s business, last on in particular, certain our deployments us. enterprise, the America current think, sight we In significant North just stated notebook and on But as in underrepresented roadmap. I is in think, for segments. new desktop more are line I and the of We again, focus

on we very focused premium. So are

on gaming we We and focused commercial. on are are focused very

gain in are, opportunities continue us share. for to think again, there I those to areas,

we desktop channel just I think new or the launched Ryzen lineup. in sort desktop business, of the We Series. DIY have XXXX business a strong

well next takes that’s puts We sort year have the various that products the launch as we additional will of businesses. in and and

your then Data and forward if a ASPs up year choose just least spreads getting pricing maybe think you stays and I the of back or do it is this that Center give little as CPUs. the competitor are PCs you macros at mentioned guess, on If a in tough to you And market, the difficult? getting getting how into would my into downturn aggressive follow-up, if Sure. next pricing going share that into some on and environment remains little price continues

think, I value are Chris, strong proposition. -- we a have very we

on Our price. strategy lead is not to

you a find There us in our the terms if work of in to been look has focus So Data leading in is lot and Center. of where in not one that’s factor, at do is -- look workload the factor for the price of majority Center, we is selections. optimization the the Data although price

So, hopefully, that piece. that answers

business, relates it As the PC is more it to price-sensitive.

We become price-sensitive. have it seen more

are we we value ago, profitable a and Chrome because, we didn’t again, a ensuring where that again, have a think, competitive. going are in so we profitable was back we year to in to compete even to very But I choose market, that business continue is business. not strong us for what disciplined be will proposition just the be taking

it. Got Lisa. Thanks,

Thank you.

Thank you.

question from Next from coming UBS. Timothy Arcuri is

live. now is line Your

much ask U.S.-China of the they but as that’s sell-in. had report didn’t and but impact Hi. trade travel have on direction to Lisa, you seems clear seem too the I China about Thanks you, I direct first, I pretty a XX% and lot. wanted recent to guess revenue, two. of restrictions,

follow-up, your China you I of help how what how am too. you making a are you about wondering you going. the I Thanks. and China think with TAM handicap decisions, if of travel? do So a the And is and U.S.-China had kind direction basis consumption maybe trade on When these can investment us where is

Tim. Sure, Yeah.

regulations near-term. the it is of Upon minimal they So we closely. new all as into on the impact very the our are certainly reviewing watching in revenue situation effect, have gone

U.S. on the my need how our follow And U.S. working commerce I rest think on are the the certainly basis, is, it, rolling are always understand will of Government with The non-Data of the national China business medium-term and and those Center. on a call We again, for things out. we view security. majority very then is, these regulations closely let’s

facing So as in well business, some as the more businesses. it’s consumer of in the PC

it we seen But and we to continue go as for impacts, that closely. in So not the we we have are the will follow very forward paying significant near-term, to attention any business.

PCs. I Thank to ask I Lisa. question wanted you, a then, And about guess,

weak lost only months, mean and you like that, leaned I and annualize July you next are inventory like think PCs get that and hard would market seemed Does has I So I bad QX. months. some don’t run when and been of in in improvement late you it things in It a billion year. we there’s those that, to QX, basically out $X guided you into that rate were sort maybe It’s at year. head massively know, million units two were XX like in absorbed, XXX fine basically a would the little kind million the seem then of bit? mean if probably units

on So September you because I terrible been if rate, am sort must of run Thanks. just have and comment August kind can months? of wondering the

did the in I quarter. a we was the certainly amount inventory that, third third The quarter. good volatile say PC in of market drain would

-- indicates over the think, into are market the behaves for like will how have the depends in we guide and think And that. various we weaker make our fourth -- visibility of fourth course, in desire quarter, a next I the said, progress PC macro on good couple drain a environment I I I think we we and of all the months, are planning in quarter. to more we but factors are it

Tim. you, Thank

you. Thank

will please. we more two take questions, Operator,

Certainly.

Barclays. is question from Blayne coming next Our Curtis from

live. line is now Your

taking the question. back the to want Thanks prior. Hey. just question for I go to pricing

there there thoughts there’s look be a a away thoughts your the mentioned to factors. from that couple versus curious about impact to to mix as units pricing think high business just you way of I’d your is pricing end, your as and think of but at then little a you Client If competition, I over kind in the decline XX%, well?

Yeah.

units. Blayne, it more was certainly So,

the were they down ASPs asked Stacy up sequentially, question earlier. year-over-year. think but were I

see more clear an So in the the basis. factor inventory. terms would the the market units, there driven market, that sort I velocity then weakened, in was And decline ASP what a but there desire of in of pressure was terms was high to sequential by on and as more just we say end of at

And lower and so more the mix mix to inventory. towards clear ASPs that incentives did towards

to I term mix change, what though, As were a term, it relates don’t you like if asking. significant feel that’s longer longer there’s

saying points PCs are favor part I Data margins are But QX down I basis will guess much. Embedded. down maybe that and kind mix the the not XXX ask second gross of second QX, part I is -- is, in you are Center from with to then guess going your

So I is guess figuring can’t pricing -- I I maybe either. bad not was that

again, that’s guess a reason XXX points margins basis I the asking, QX? for to of from long core down way So what’s to the QX be

Yeah.

Okay.

that. me let try So

the factors. think you what see about couple if of So a in There’s business. we

excluding million say, you that about if described $XXX So we charges the QX, XX%. we the in were

to make -- mix guiding to when are see to Devinder for have do clear particularly market, -- do And that the business. a see we coming mix market to sure additional Data capacity, has higher North we lower then we have that We bit continuing in the a some capacity cost some were and impact. online want given client that We just tends as the Center XX%. additional inventories. that we of be ASPs We cloud, -- do environment America is there be server mentioned in We that weak. the to in increase

factors get the So those are you that of XX%. the couple to

Thanks.

Sure.

you. Thank

final is coming Kumar Piper today question Harsh from Our Sandler. from

is line now Your live.

guys. Hey, Yeah.

seeing data center think Genoa? me inventory the seeing had could of and and Do launching the think to, you the First you up? that sort dislocations of have not differentiate Lisa, growing data in and/or of of do quarter, a the or think center was do question and you cloud you that a And all, the is I then there market the center in. growth AMD, near-term are inherently point, thanks I you the and call is market, -- are it, you you growing I squeezing are market. between just view you if because And built talked are December about curious you data mid-term market. specifically to follow-up. slower what that’s got for

Yeah.

I look, very basis, data on So, I up. overall a again, would the discrete say is what necessarily wouldn’t center is, say market

there Just some macro on overall given is impact, the impact spending.

our in is I cloud terms tends market. towards a In Like enterprise weighting -- America is said, business, to then relates of the what’s of have it to And market? part that we I think, happening most as resilient do what’s the weak. be happening the sort of North

there’s think weak been bit cloud, people and general, cautious. are has different China And year. in a in to just being not trying do. what weak all customer then businesses I more that they in is are in overall -- general, every is is

optimizing are then to some some build. footprint and inventory, optimizing are continuing just are Some

call call for talking with customers. about are not what wouldn’t se. I instances per us for it our What’s each is would I customer. we QX so their is, individual And it a just market helpful

for the for planning mean were we workloads. see are moving do and I where when about need what coming moving of the so and they there, are really we constrained capacity are of which and are XXXX. workloads they necessary we a are supply talking that’s we We from all each place

us some are that for their into spending so gives XXXX. what plans And visibility

mentioned Lisa. was for the September, Of talk the peak market last general? quarter. And helpful, gaming my Very then course, about you can you follow-up, in

hands just be hard try should to December it still peak get, are your will get you PSX, thinking things the because and some. on that can’t down off Gaming to will this to Gaming these buy in we XXXX So be still is be so year But also go or easily.

So there’s to more next legs left do you year? the growth think

Yeah.

coming is So, still into we this some especially holiday that season. Harsh, do pent-up there believe demand,

for this QX was QX you as year. down expect. us the So is might peak seasonally

to model let’s holiday into would at year, say goes, way call that think, are best how would Going flattish I the point model to but is I and point. Gaming the there at segment it takes. this puts this next way be see the we and would season

you. Thank

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

tuning Kevin. Thanks, look everybody Thanks, important to coming product we that we Thank we forward in connecting two with launches This throughout to will so concludes for next here the in you and everyone. all XX call. forward have up And today you the the days, engagement. look quarter.

Thank you.

We you may today. day. your participation for a disconnect You and thank now have wonderful