Advanced Micro Devices (AMD) 30 Jan 242023 Q4 Earnings call transcript

Greetings, and welcome to the AMD Fourth Quarter and Full Year 2023 Conference Call. [Operator Instructions] And as a reminder, this conference is being recorded.

It is now my pleasure to introduce to you Mitch Haws, Vice President, Investor Relations. Thank you, Mitch.

You may begin.

welcome Results Fourth Conference and Year and John, Financial XXXX Call. you, to Quarter AMD's Full Thank By now, and you review a should have had of earnings the our press release the slides. copy accompanying opportunity to

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over to Lisa. that, With hand the call I'll

despite as significantly listening XXXX afternoon environment. and today. Mitch, those data throughout the We sales demand strong good you, center Thank mixed accelerated in the year all finished to

top Instinct cloud, customers. revenue bottom record segment accelerators annual across line of and growth driven demand ramp the by enterprise result, data in AI server and we EPYC CPUs and delivered As quarter, fourth and robust for a the line center strong AI

by XX% billion, segment basis, revenue as significant was our in offset annual revenue revenue revenue. segments. and lower to data financial declined segment double-digit at client client $XX.X year-over-year embedded gaming center year quarter driven growth to our results. full Fourth and and annual billion $X.X center X% increased Looking percentage a by data record On

Importantly, Embedded $X.X by adaptive AI maintained Instinct XX% more billion revenue revenue Data accounted next-generation and as server the segment provider our annual in Center of position and grew share, our solutions. industry's largest than and XXXX as we gained of launched accelerators computing for

fourth demand Data to sales revenue grew quarterly segment CPU quarter to XX% and Server Turning the results. sequentially and Data driven billion. accelerated quarter, of Data revenue throughout a by record in Center Center share $X.X as CPU fourth-gen business sales third-gen and revenue for the year-over-year revenue growth GPU records annual processor EPYC year. EPYC our Center our portfolio. processor and in XX% significant gained server set products percentage double-digit both the We

general-purpose into XXX than Microsoft Amazon, expanded to the In year-over-year Alibaba, were than remains deployments internal cloud, CPU-based Google, instances. and and fourth general instances workloads sequentially increased HPC demand cloud while overall preview EPYC EPYC more as AI, Oracle soft, public brought there more Exiting quarter. revenue and AMD-powered instances processor XX their server hyperscalers XXXX, North or in American power CPU public environment fourth-gen the availability available. cloud and

efficiency to CPU number EPYC of leadership the performance, features portfolio. XXXX this grow and We based our expect on in

based as multiple smaller for customers. adopting of to We models number power continued significant our double-digit a where with leadership closed as Forbes nodes quarter accelerated workloads delivers growing wins A EPYC In XXXX. for built CPUs retail, on throughput large percentage well training performance inferencing we financial, us and clusters. planned inference deployments enterprise, sales head as energy, by customers advantages automotive, production are like expanded on in positioning large with pharmaceutical for LLaMA-Xb well XXXX in growth companies, technology the momentum and significant

drop-in Looking platforms strong. with expansion extends and ahead, existing customer a very across excitement addition core, fourth-gen for for Zen new the our upcoming efficiency replacement that our Turin processors our EPYC performance, family core EPYC a and TCO with X next-gen is Turin of leadership leadership capabilities range performance of leadership a memory Internal is end track later workloads per when it of and watt higher work launches plan, core as this on deliver year. is to or counts. well on overall customer progressing validation as per Turin to basis wide

portfolio. data center Turning our to broader

GPU and $XXX in center MIXXX the for exceeding data our supercomputing GPUs leadership are customers. providers, MIXXXX OEMs high-performance industry-leading MIXXXx launched accelerator developers. positive, We bandwidth AI combining partner generative AI family CDNA revenue overwhelmingly ramping with and driven capacity. dozens the customers quarter, to deliver with major been by December support has significantly multiple AI a faster to ramp response business cloud, Our and support strong and in deploying ecosystem our leading Instinct Customer from and cloud accelerators. with all large of many accelerated expectation, MIXXX million memory performance production X architecture we enterprise aggressively by our the with

on AI Oracle, other In Meta closely offerings. are workloads cloud, both internal and powering their we GPU external deployments, large customers working Instinct and Microsoft, with cloud

the it Instinct track Capitan what to the Dell, in this customers. complete online AMD shipped enterprise supercomputer comes Lenovo, we are year. to vendors of launch accelerators and be quarter quarter HPC expected when for In supercomputer HPE, later El strong the to this fastest from expect Supermicro platforms this MIXXXA with fourth and quarter world's for is shipments For on multiple majority the other supercomputing, MIXXX server differentiated demand customers, later enterprise

for development, flagship software we as AI of Instinct software well for High-Performance suite. world's working and closed Eni. supercomputers expanding platforms new developer of in and the the ecosystem additional AI The also adds be progress and libraries We release significant optimizations one HLRS, the ROCm German stack the expected workloads, X made the X GPU most ROCm what frameworks quarter, powerful company, generative key including the in developers increases of wins experience. performance the Computing as overall Center, expanded with is significantly our system to energy on enterprise AMD simplifies On support at AI

AMD ROCm most enterprise and software X the functionality the enabling optimizations accelerators. of additional multiple language up bring AI their to advanced The volume models are growing of community and rapidly source and contributions large from hyperscale large on Instinct open customers

very environment aligned launch. with out private and their MIXXXX how MIXXX Azure to able Microsoft bring For on of to new the GPT-X instances example, we are in production roll quickly pleased see MIXXXX was up previews

of time, the now box the GPUs, open thousands same enables Face, Hugging partnership to the are platform our with models of we At and for extending AMD platforms. run collaboration out hundreds leading AI on to that other AI the of our community,

from GPU guidance now and XXXX. be Looking expanded for to customer engagements, XXXX. pull GPU to the flattish QX data center the $X was revenue exceed in expect grow billion data for center in billion we and exceed and to $X.X quarter revenue prior ahead, our QX Based on strong first sequentially

significant capacity chain to also progress additional have partners upside secured have made demand. support supply and our with We

combine by including sequentially. that launched Series on an and Ryzen was Revenue flat XXXX all AI to and delivers $X.X compared leadership Ryzen Turning client performance February. notebooks prior that generation was compute Ryzen with and energy our go offer latest our OEMs already in other up our powered Lenovo, our XX% segment. billion, with XXXX desktop Series Acer, in efficiency increase We to that industry-leading. sale XXXX MPU updated Mobile to first and to XX% performance January, year-over-year notebooks MSI will generation of expected our an HP, more PC ASUS, processors, the series large systems processors

Millions PCs, by an processors leadership of to have processors earlier market. than AI AI-enabled in currently Ryzen month, we further and XX% CPUs more this CPUs our are AI series desktop the AI our PCs powered integrated PCs Ryzen power shipped with of industry's in launched Ryzen date To which first XXXXG engine.

the of PC expanded work the to quarter. Microsoft our generation with partners Our next PCs and significantly AI ecosystem in enable

core momentum for Ryzen Customer and significantly an the to graphics driving performance, Strix performance AI our launch including engine to Ryzen Ryzen of aggressively first RDNA road with our expected combines is AI processors. extend Series CPU XXXX are to capabilities this next-gen our enhanced increase map X AI that our AI strong, PCs. are updated next-gen AI of deliver Strix the later Xx We with energy track than Strix processors leadership, Zen year. efficiency to our on more and notebooks

grow Looking the half for we at PC year-on-year, AI towards ramp. modestly are XXXX, PCs TAM second planning the as to weighted

wave next products, see growth opportunities of ramp AI to our CPUs. leadership PC we X strong current launch as continue client and our We business extend our Zen our for

$X.X of Radeon Revenue billion sales to X% Semi-custom turning XX% revenue year-over-year in segment. our increased the and to as Now semi-custom lower partially projections was declined in our Gaming declined quarter. offset sequentially sales line by with SoC GPUs.

now annual year XXXX cycle. a fifth with as been up entered of console demand forward, in we a caught Going has supply expect double-digit percentage to decline revenue we by significant very the year-over-year and what strong

price channel driven Gaming with demand launch expanded this In in new Series that our GPUs. XXXX XXXX performance XXXXp Radeon series year-over-year our offer by Radeon and desktop earlier XT grew Radeon strong for the for sequentially, series both leadership and XXXX the month XXXX of GPU revenue RX graphics, We enthusiast GPUs gaming. both

new also frame We can software significantly both FX Super X higher and deliver Fidelity rates gaming source on open launched APUs. Resolution that GPUs

decreased communications levels. in We launched $X.X industry-first health leadership with We compared XX% DDRX markets prior our memory to deliver their Embedded aerospace, reducing increased DSP Revenue capability SoCs Prime markets. Turning customers new as segment. care generation. and to solutions the embedded sequentially XX% test and on and expanded new key focused for measurement, and to inventory for the our that quarter our Adaptive support Versal year-over-year for billion portfolio

and we Versal industry-leading solutions capabilities automotive, to SoC that launched bring compute advanced new next-generation AI and safety security vehicles. features In

performance embedded server machine We robotics and and vision, processors edge industrial unmatched launched Ryzen also for automation, features with applications.

in than of billion first expect compared XXXX, term, levels. confident to will of customers $XX product more business at as XX% through portfolio the Looking than XXXX. we growth more year to continue demand wins soft the design expanded on an their overall of increase drove the Embedded trajectory XXXX, Longer focus our in inventory our of as Embedded very half normalizing remain we're

year very fourth summary, quarter with In I'm and our pleased full results.

portion data demand Against we our expect the will offset environment in every our Ryzen starting of to Embedded the Instinct, a AI segments. once-in-a-generation back, portfolios. strong and annual segments, then product with strong growth growth expand multiple that into backdrop, and strength gross reshape Gaming our EPYC we a mixed, margin, Taking embedded this For believe center remain we believe in markets. center step revenue is data of expanding and virtually deliver and and client market, by transition the computing XXXX, declines PCs driven across the in will we by and

positioning We $XXX our opportunities continues tracking strategy. to In with of the ramp XXXX and clear the us have maps, data ROCm based data road of Customer product deployments growing cycle of growth accelerating, software in of traction strength multi-generation of our to any in center, significant GPU accelerators instinct with we AI map portfolio. across multiyear built our capture customer on based XXXX. as open for the GPUs coming wave strength leadership and and software AI revenue the to share multiyear road see deliver our a be the AI and adoption Instinct see a on AI hardware well fastest to source we our start as excellent drive approximately the our market center next years now of solutions over MIXXX history billion we

NPU growth are for we time AI leadership of IP, breadth we capabilities PC This leadership portfolio portfolio. several expansion differentiated more capabilities Microsoft as relationships exciting our over us the later long-term and are an full the software earnings road enable our broad and next to AI across deliver with to driving same embedded other even the PCs, revenue industry well maps position AMD is exciting and on leadership partners the focused bring experiences product this time deep In for customer rapidly significant time, product years. as starting and our to our Ryzen AI incredibly delivering compute new At capabilities year.

provide full to the Now and like to color year our fourth turn I'd results. on to call Jean over some Jean? financial quarter additional

AMD segments. for $X.XX. Thank growth the demand and provide of start despite executed and you, afternoon, and fiscal well Lisa, outlook $XX.X data mixed per embedded of good results earnings review year-over-year with We delivering first drove billion I'll our share of everyone. in center of a XXXX. market current quarter and in our our financial environment, revenue then XXXX revenue

AMD positioning in successfully the in our a ramp In AI XXXX us addition, we launched Instinct market. GPUs, for MIXXX strong

the GPUs partially in segment offset year-over-year, was Embedded segments across from and offset contribution EPYC Client lower as For several Embedded Gross by and quarter XXXX, up revenue with leading our and the and from by higher customers year-over-year Instinct revenues. revenue was offset in higher was the processors, Embedded AMD revenue Client revenue lower revenue of of segments Gaming X% driven Center XX% by the Revenue decline and segment. XX%, the the revenue. growth ramp was Center margin server fourth the billion, the Data segment flat growing Data Gaming in sequentially, partially primarily $X.X by

$X.X R&D and billion, Operating invest income margin. as activities support XX% representing an growth was $XXX Operating a and significant expenses X% of in to interest million. AI were we expense other was increase operating marketing our billion, year-over-year opportunities. $X.X Taxes,

quarter earnings XX% of increase the fourth was $X.XX, year-over-year. of an XXXX, per For share diluted

by loss segment million a turning was by revenue million revenue. Data was sales. Instinct year $X.X Client operating by $XXX billion, $X.X with million a primarily Center sales. or liability Ryzen driven XXXX XX% X% driven driven to and Starting compared EPYC higher was of to year Center revenue ago an operating CPU strong revenue compared up billion, fourth-generation Client Data revenue. Now XX% XX% up and the segment operating XX% $XX ago. driven Higher of was income XX% Series CPU year-over-year, operating or income AMD by segment, operating income reportable AMD revenue $XXX $XXX or higher due both segments. was year-over-year to GPU growth of the segment to million of our sequentially,

X% Gaming segment Embedded revenue as a million or in to or down XX% segment year of ago. work offset GPU billion, and was compared inventory operating was XX% million by revenue billion, ago. or customers income sequentially year operating XX% continue decrease $X.X compared due or in Radeon year-over-year $XXX $X.X segment was sequentially XX% to year-over-year down Embedded partially a XX% to increase $XXX to of down their and revenue revenue, levels. segment Gaming was a million XX% sales. million semi-custom $XXX XX% $XXX income revenue

sheet and flow. balance cash the to Turning

During free $XXX At and the quarter, short-term quarter, In investment fourth at X to and million cash cash returned the we decreased was million. in cash, shareholders. $XXX shares equivalents and $X.X of to million the million generated million the Inventory by operations from $XXX the $X.X cash flow strong repurchased billion. billion. end $XX we was quarter, sequentially

repurchased we For the year, million to and returned million XX shares shareholders. $XXX

remaining in billion $X.X have authorization. We share repurchase

outlook. of Now turning to first XXXX quarter our

percentage. strength share Data expect what significant portfolio Year-over-year, and significant to inventory revenue has to seasonal cycle and to strong Embedded by be segment, expect by segment decline Embedded in ramp. strong percentage to segment Gaming double-digit segment revenue expect revenues double-digit percentage. continue given sales levels. And levels, the approximately of by Client GPU decline we to revenue Center to product given expect decline Client with the Center inventory Data we by to and decline million. We flat, offset as very decline minus revenue plus server we billion, $XXX Sequentially, be enter we strong increase Data gaming to year to down $X.X opportunities. in or seasonally. customer work as been of revenue segment gain the current the decline Center revenue the a their segment our double-digit fifth Gaming and customers the

approximately expect shares. we Non-GAAP expenses $X.XX tax count addition, diluted In effective non-GAAP first be be rate Non-GAAP to approximately and approximately X.XX XX%. be to to be operating expected billion quarter share XX% gross billion. margin is the to

year some provide While we color. guidance are me specific XXXX, not providing full for let

to opportunities. the XXXX and to year, portfolio segment the and the by Center revenue Client by strengths Gaming decline our gain expect product and decline share percentage. revenue for the we to of the double-digit increase, segment the Directionally, segment Data Embedded driven significant revenue

expand deliver gross large address AI leverage per opportunities the continue share growth We while model invest margin XXXX to to line earnings driving operating expect in and top than to to growth. faster revenue

In closing, of provider financial results center portfolio strengthening delivered as AI. a ourselves GPUs and solid in for further establishing leading we XXXX, our product data

to positioned on this momentum and and performance well deliver very XXXX are We strong build financial beyond. in

the turn for it Mitch With to that, I'll Q&A session. back

poll audience John, Thank questions. to for you, the Jean. happy we're

first Aaron Wells question The of line from from Instructions] comes [Operator Fargo. the Rakers

framing first expected the is, the first center and the $XXX Just quarter. outlook QX, to relative out XQ of a we GPU million that guidance basis, the you what you question the can I about is can into revenue help calendar on of fell Server help the as on of this appreciate guidance kind guide? XQ, data in for you us think business seasonal what that ultimately defined then guess be? the us kind And into

Aaron. Sure,

Let me add. see start has to and then something Jean if

saw on way and we were saw the AI well. GPU the saw the quarter very So were very And actually look, of the based be went MIXXXA, qualifications customer our going center MIXXXX, data ramp to the relative strong business, back-end HPC that pleased ramp. quarter. product was demand, a And sort exceed the It ramping ramped the very to manufacturer with -- always then our in the the product we weighted performance we as fourth expectations product. actually we we then

the in business fourth that for million $XXX over quarter. were we So

double some of as are business, high call seasonality, digit. And low we also There around, server at other pieces single it, it, the call something first let's the then center quarter, business. going data look digit, into the

I And of key originally strong. to operating MIXXXX. we're of think now ramp a had shallow really the be it what piece customer seeing little chain is is, more the demand is the we is supply expected our well bit and the

and first will as MIXXXx we go the see relatively quarter things increase well. so into And going we are

Aaron, and Yes. about some seasonality I'll color give others. client you

So digit high double similar That's to to with past. Typically, the very low QX consistent single server. is Client digit. is

bottoming is have Embedded Embedded side, past decline. what with consistent consistent see sequential Embedded. industry it we a very in through going And with a double-digit the and the think the QX, business will it's low we what That's you On in said is process.

On during inventory the late the remarks Gaming is of the in year gaming of side, Lisa prepared same we having X at customers. the cycle mentioned time, also we're have product her at console. the But stage

combination XX%. probably expect than QX decline those of the So the impact, more we sequential gaming

that hopefully, So bit. a helps little you

Jean. shipments you Very follow-up, through signals server any seeing server traditional, curious, we north the it, move demand we when as call 'XX? helpful, that I'm know a CPU, Yes. are at And market quick how you see, or in thinking non-AI you recovery XX% Are a year-over-year. of about look just server down general-purpose I as traditional that are

Aaron. Sure,

think and Genoa I the XXXX the with progress cloud of agree second family. although as in X I enterprise your strong customers Zen adopted see look, our our in So we year, characterization especially some did and of the demand, half

enterprise some half So mixed, going the on cautious. the still being little would There's bit of especially year. going well of XXXX, is traditional as into cloud optimization sort I first a market into as probably server say the still

to being to server the we case, share in business. continue see opportunities That the traditional for though, also us grow

and coming of as see half lot adoption new is Zen in also are product, And Bergamo strong. portfolio our a we of lines our then think year. traction. as The Siena second the I product Turin, the well our X of Genoa extremely getting

I XXXX. demand in mixed a what CPUs we're traditional can server in even think bullish So on environment, do

the comes from of line with the And next question UBS. Timothy Arcuri

you have for marching on sense if that this terms Lisa, toward little TAM a kind of I'm of milepost you're bit you wondering $XXX can that us XXXX. in billion give the of

the Or For higher do rate that's example, I a share different way, share than percent? at Is at reasonable share can guess, have a maybe gain perhaps? of you GPU that for kind of a look that do similar you you of it server gained aspirations reasonable XX-plus Or asked is CPU? bogey? to your that you to kind think consumer rate

the things. for Tim, Thanks, a I of Yes. question. say would couple

in all, made the really pleased of we've Data GPU Center we're with that progress business. First our

has a seen, think us the that few I traction even of been and the business. we've think, that confidence the that seen in customer ramp in last of we've months, this ramp the lot great I gives

I I framework. to think here the it's market well market in as so as beauty have is of growing think ability we share that the our quickly both AI gain the that dynamic

of with The all customer are point customers I right conversations. will make strategic, engagements is, our multigenerational now quite dozens

about are as XXXX, the of to extend do So time there's and into that also 'XX, next excited MIXXX, 'XX, years we lot opportunities the out frame. a frankly, we're as to in the excited of about into ramp couple very that 'XX

think we of see I lot So growth. a

to early It's given demand growth think it's share well significant own market a a but I as would say projections, capabilities. product our market as little driver I the make

pin GPU you add of bit, that And revenue then I'm kind a business that and wondering within maybe guess you double server little on touch But is I milepost don't it on target? reasonable like for that full those if the you're I you XX% know if a follow-up, can a if numbers. just up us Center Jean, Is maybe incremental marching company. should as just growth the for any the Data year-over-year. give I the can to ranges you want that I'm a down XXXX kind a year, but to you whole guide that guess, wondering Data assume Center, grows of I seems

very for literally of year. a Thank January. Tim. guiding Yes, question. not early year, the It's you the we're

to both during and think way grow her good I about mentioned is, Lisa pretty think XXXX. Data to it the our it business remarks, prepared Client feel in about Center we

from both revenue incremental going the GPU side MIXXX. the Center share data more our a between center side course, server opportunities gaining are the come ramp largest and with significant Data of to Of

how think it. about think we I that's

Gaming do half we going is We will have a the see do we through recovery. process. year-over-year, think the segment. Gaming the same And segment, on Embedded headwind think see double-digit We significant bottoming the very second at will do time, decline the from

those the are can I takes and puts it. So about talk

And the line from with next question comes the Ramsay Cowen. TD of Matt

to Lisa, ask, mean, in markets. been and think, last you're much scrutiny I software there's dozens there MIXXX. so mean and right, progression on from, community should wanted the that your with exciting to investment And product. And with, I now different I focus ability proven really you the I X the of be it to as across months some we've doubts I the progressed over end you've ramp customers, think, ramping said

What interested forward and be you color road kind the of thinking to they're of cadence it would only Just that about little give map I'd you some I'm you a server about of any program like road forward traditional are what continue -- for a on map interested family? be hear have going more programs CPU that it and road to Is a been map hearing primarily from thinking in MI some perspective. look about open going you're your the be guys bit to business your accelerator in road trajectory map? the What how of in about? together? Is parts us really GPU are helpful. can to kind GPU

Matt. Sure, Yes.

the So I comments. appreciate

with the family strong. traction is MIXXX getting that think we're the I really

sort as is get continue to advantages. us given I technologies, of And version, how ourselves. memory our benefited memory APU both capacity that and think have and here use we what's the chiplet differentiate GPU we which us our that's of to version to the bandwidth ability use has as well the

As in we map. like way go imagine plan forward, in planning EPYC we the That's frame, sequence. generations we we're multiple you the the time can did road

of road road map. will I we so can couple road about note as for a the very come an will later things we're we'll both sort our the are with we for out closely market compute and demand be that you of of the assured over the we map overall would seeing map about are into is more generations our get say the acceleration have customers years. acceleration here, road high that year, talk training of beyond similarly MIXXX but next AI map One competitive working that accelerator planning the this is inference of to I that very and

Just little as that for a TAM XXXX. been lot a the questions forms out I guys follow-up, billion to guess different one in that respect laid have $XXX of with you getting the did a the question, the us same is the I've give under XXX the could to, you number. Maybe that look with as of up hood you which versions how I've I got guess, -- come is heck

gives systems Are talking we and bit the more are of about we Are really can precise on of number so give kind about accelerator give us silicon? we about full market would years that any unit That what thing generative servers? trend So a of out? if helpful. really, And a be talking cards? in you into of could kind sort this early you talking little you assumptions, terms us the give or to visibility X AI sizing what just

Sure. is, rate $XXX to need billion. said Well, do I look is Matt, at growth it those get know don't we we think but I what I how think precise and rates. we But to how approximately growth

percentage. content expect expect we think going that also grow. double-digit to But you units should substantial is of to sort grow I

advanced see in you is, just more acceleration memory content go that to if important capacity there the overall about and So we'll as think you how nodes. memory we as we imagine go can forward, technology

then clusters. the clusters, ASP of uplift And customers as just of we So of going is also enterprises that couple the And road of in of maps there's sort how into the thinking the we do inference is years, training believe more actually training exceed given fact number to next they're adopt. we we're go about in with planning as size some longer-term terms then training what our there.

think So all I look growth the over feel good those I few going the be think is we significant that pieces, at and rate years. sustained as to we next

in In what's terms TAM. TAM, is of accelerator it that really

accelerators, GPUs, within and other are there also that or accelerators ASICs TAM. there will certainly that are So that in be are some --

about talking the the models to inferencing different think the models, models. training to -- from largest and need for models of GPUs be we you're from But fine-tuning of language on language smaller As very to our going standpoint, the -- of those of think different you're largest to going still different compute types sort models silicon use I the large about cases. element are when choice sort of

And question comes Joe the Morgan Moore line Stanley. with the next of from

I the about cloud. kind a brand-new your between how customer-facing to how is a being is chip, the support the about able you talked breakdown split in kind And think you workloads customer-facing This you that? of talk of it versus cloud see seems more internal. workloads that impressive workloads you're Can of ecosystem of range broad MIXXX progressing?

Yes, sure, Joe.

MIXXX important optimizing would has have seen what optimization that working happy are we've expect, and as the optimization capabilities that of performance said is always with certainly with directly but look, our the nicely, ROCm we number level optimization, We now way a with we've very frankly, well of as best gone that has is the X yes, most come What and do been with the cloud top how we seen has we to up which we some up, well. customers. come really have the working important is So And the GPU of software on deployed customers. workloads. direct

lots side for way us on as customers, who cloud are to of opportunities directly with the this the at work is think I and I as the workloads. broader there enterprise your well have specific large both look on training to question, side inferencing

Our job to it possible as is as for make easy them.

then entire all to really open our nice X overall progress the sort -- so the also tool some ROCm getting source over significant chain, support of gone through And And from the X has suite last community. we're our of months.

with partnership our source us real-time just on and across make OpenAI these doing So work tremendous our actually of has very Face the our number Hugging Triton helped that models progress. on work a terms is open in is optimization rapid of hardware,

hearing I'm a Asia. hearing AMD's And guess, the my business sort you AX and you us and to of Are think scenario? building I'm how just year I I about when close forecasting worry case chain follow-up, I hear of coming bridge from supply your gap. would the curious guess so people best be expectations building Just supply kind how to we're being at numbers. out revenue? you for about chain you Great. for for sold that Are the ask these in of looking is of the lot would And supply sometimes that? the chain, would

Yes.

who commitments quarter we we're to our have working $X are to try on original the expectations think way the some I customers this with some revenue Joe, given billion $X.X these billion updated mean, to firm there. I The give about think So us billion they from that on what of of number is our need. to discussion bounding $X.X out

you As quite times these products lead the long. are on know,

in book. have And important a order we strong those So to it's have early. forecasts

good us gives confidence that exceed to the So billion. $X.X

From capacity standpoint, more always and is tight capacity. a have made half our comes we progress so from chain and is -- second We of also about but significant we've partners standpoint, there. more the first supply it our secured with supply and the certainly year, chain in on Think that supply. half build worked more goal to as

to to we're going supply, update the our So year. customers deployments, as and go through with we we number and we'll do their have work on that more continue

next of Toshiya line from Goldman with And Sachs. the comes Hari question the

QX guess, on the how think the we line I should it through QX? second think that? we beyond the about half had year? balance quarterly of up we assume more to a well, all, talked You Is Lisa. about as I Or should trajectory first one is straight MIXXX about being of progress fair kind How the of as sequentially. skewed? it

of I of holding and concern? guess what's software tweak just a Or of the bit to potential customers up on have back a things? need it MIXXX. time is and sticking some importantly, -- sign more cloud that forth little point? just point? Is them function the guess time kind this guess a for there what's sign at officially back more yet I go and you And I the to off

for the question. Thanks Toshiya. Yes,

bit of chain more supply trajectory, the is now MIXXX qualifications finishing up the of their revenue the second half ramping. on as quarter be weighted. And part of would first, in year, how as you should lines our every from end of sort think they're as that a is I their sort just well customers that expect So increase will through it but

each yes, So a but half more quarter, weighted. increase be it second bit should

about large EPYC. deep all well, to our These with given all engaged then of the customers. comment Look, sort of folks us in that relationships your we're really know -- And customers. are

different adoption space. view they're their question early very And as for I I in they what think cycles map. very, think earlier. consider have this road still But a trying do just in to I innings this us was people asked as

this conversation, sort is about multigenerational not long-term I of just road it MIXXX map. really think is our but the key about an is

And so our and engaged or, it, there's typical more as, customers, context working but more lot know, are very coming that AI-specific you that's with. the we're with we're as AI-centric of well as folks from enterprise customers let's necessarily not largest companies call well cloud which also on that a demand

Jean as margin Got And it. my gross helpful. That's super maybe the one on then follow-up, side. for

to think improves you're I'm and to not to guidance QX QX going quantitative the how some about sure sure that kinks trajectory I'm as over again, Hopefully, Instinct ramp. it beyond XX%. pertains but through beyond. the QX, -- working for time. You're to Curious guiding pretty you're give

and the So perhaps CPU second that FPGAs, throughout a should better, be turns volume the you've half the growth server got for year. tailwind.

tailwinds margin headwinds feels we progression as got throughout are we gross it as you've potential about So think what sequential XXXX? move like multiple But basis. a the on

you Yes, you're Yes, the right. question. thank absolutely Toshiya, for

QX the business our QX Embedded guided points and of primarily because sequentially, higher impact than QX. puts the We in than of actually the more basis We XXX have takes some gross that offset margin. higher Data decline contribution Center

Center to major That Data mix than is Going think business to the segments. will expand is much is help forward, to going the to other change grow it going the about as be said, is, faster you driver nicely. gross way margin us

in tailwind. are spot half, also coming second which on back the will you be a think on, Embedded I

the GPU, Center With ramp. stage we Data are at early the very of

yield testing margin, expect accretive expand are it average. continue corporate to we We and time to improving to and be gross

does in half second the to first Embedded QX we in business the the are of about we to tailwinds see where those be going trajectory the in us headwinds headwind because sequentially good second side feel But very see That half. for say, probably So a I all it are would gross only nice especially continue we have overall, be gross decline. half. QX, coming improvement, margin margin. flattish the QX. not a versus is the pretty sequential

the And Ross of comes Bank. question from line Seymore next Deutsche with the

want I competitive into to environment. the get

the server you're But Lisa, in things, the as doesn't side pricing on whatsoever. those XXXX? competitive said CPU that's on environment down ramp we slowing change be sorts you're seeing think share how in maps, meaningful of things, future seem gaining First, Instinct through the things, side of It you also of that about your straight to any then going. that road incentives, area. But

Ross. Sure,

I the think environment is us for competitive. always look, So

in that I places MIXXX map -- we've have even work. look we let's our significant But that's more competitive. I the are that some very So in think There we of If environment, are not I inferencing like has look and some training it, think where, at I changed. think at we And advantages. environment. through think as side, the our we shown actually it's the road customer Instinct call have shown

be will inference, to and training both for think we competitive. continue very we So

view, CPU into again, gain EPYC, as you side, continued then generation our of with from we've And the to each go share.

we in fourth share quite underrepresented quarter exited AMD, we're and record the think at for still I enterprise.

there's So see deep we're very about competitive good for go right to Genoa, a Zen is as continue Siena. through I in From what standpoint, opportunity XXXX. an X as to now And us we think is Turin, Turin, in with how competitive the we go Zen design X extremely for share positioned. we're we in and to feel we Bergamo, and cycle gain

I been side on guess least as side. throughout the was at clouding side, the data another the CPU my theme XXXX, pervasive follow-up, out that's GPU center

you're your et of that Instinct Or benefit is the side, that gain EPYC to things? what share, us? of a behind it you center about still is within bit where on little guys going headwind but the but data an You mentioned side side you that CPU business. of But still the from there going cloud Is clearly GPU know do I cetera, on digestion see now standing? issue?

Ross, we expect as to CPU I into a the business think go XXXX. standpoint we from market grow,

older of so starting will think see are of little for depend I energy a sort the let's cycles. some their sort call macro so refresh and plan it, is the rate we and There's the from of just do happening cycle X-year to But equipment the see larger our value into refresh we of, get growth our we pace trends. efficiency customers of much refresh are on of X- lot that infrastructure be bit to and standpoint, or yet a CapEx overall the that than footprint newer old XXXX. proposition strong because that refreshed. better the And generations the has as

as I to more exact have evolves think year. through as go the timing, the the we'll understand market we

question line next America of the comes Securities. Bank Vivek And with from Arya of the

So before. billion $X from first gave one, us for MI you -- number Lisa, a plus

later if, curious supply? raised you $X Was your in the I'm any $X Do side, $X.X or landscape the in change? the billion, related you limitation? what And say, let's Now drove can you to that, launch And right? is on signals? billion supply competitor $X competition incremental think competitive way? it the or What is over more change Was sort that BXXX the it of year. billion. billion demand to And it demand their will have will

Yes. Sure, Vivek.

So customer I really mostly we $X as went to billion, is what said billion we from demand it signals. is think $X.X

it, call programs. from, and let's have pilot into seen books move we've as full programs So programs come on as manufacturing orders

the We revenue forecast. have updated

depending go I maps, of, again, with As ensure supply a ship the competitive customer generations that focused supply than MIXXX. road I we road we then as to are in planning a what our of map we're into of partners that more and are $X.X very beyond year. on we as the on we from said, so earlier, closely demand is success, for substantially said standpoint, chain more the what billion, second next worked half can terms And sort

that do work map with to of we quickly I have to our as a believe in as So sort possible. place road map continue our customers adopt strong road and

of few have early enjoyed, longer-term And I the we Lisa, has many it's AMD if But we it. of are and at factors, of with success had adoption a that question, them TSMC. but look strong partnerships the chiplets Got now are Intel, chiplet included around it. manufacturing also your they tile seeing years they update And they all then ahead incorporating adopt and they backside competitor, X in xXX gate the delivery. as call recently, terms your technology I said or gave, think

does assume have up kind AMD they they are maybe to longer ahead, on in to medium the TSMC what have they or term? of that are caught let's impact either right So and

chiplet Yes. Look, of technologies. at the what's sort always we're looking the I the right? So on on technology, Sure, next, generation chiplet mean, Vivek. we're of fourth

I how optimize to performance think we've a there. learned lot about

leading-edge of aggressive those a are as of pieces. the it's only I technology think are But very few adoption with We our needed.

to innovate We're also architecture on continuing on focused design. and

think forward, So map on road case, feel and have to similar CPU expecting is, and question the a competition GPU asked aggressively. drive the like to very I in be going longer-term that is a continue I we think even think road process both the strong map technology. that And we I that the we'll you we're very going

from line question comes of Kumar Piper the with And the Sandler. next Harsh

X have I questions.

lot understand The side. the we MIXXX. our proposition is customers from want Let they start a the of question get with me off accelerator the value to

So rate And then hoping versus customers buying finish primarily the are it year using or you are a Or of seeing it think was Jean. you for for do compute it power. is buying primarily Lisa, today? power are inferencing that about are I they And give some comparison MIXXX Jean, MIXXX, to understanding us of you maybe today, at the could your price billion? they X.X for for tooling? run possible

Harsh. Okay,

start. So let me

the about using for are that customers a AMD. for dollar proposition MIXXX. value it Your but is different reasons, Again, presume performance per benefit there I question using to

So that's it. of piece one

of you large bandwidth what piece fewer you language intrinsically could though, that more competition. tens of free GPUs. it, make capacity The potentially do the is for have to And in we of parameters, other means that and compared is the MIXXXX memory -- are on billions models many workload

and substantial system it's to the more do allows savings a within So work you same much system.

what are that for inferencing. also today, using are of training. terms language customers it for of say using In customers MIXXX a model it large there for number I are customers using And would are there

the in being are so and partner. is both whole systems, training they used be put place, sometimes would think systems you So mixed-use AI for a they I these point inference. strong When

have time we for X more John, questions.

our billion. earlier, MIXXX. make mentioned about Yes, to we'll answer And in question have Exiting more back-end Because and X.X? possible each It XXXX, possible, of right? course, customers. supplies with sequential Lisa X.X increase more QX the Harsh, is than me And see do is continue get let your half. we to quarter progress it loaded we'll second

the possible. X.X it's now, the So we the billion-plus. current on math, But really are focusing of execution looking right at yes,

question next the Stacy comes line from the Rasgon Bernstein with of Research. And

more expected and For talked than shallow it's better about had doing the first that one, clearly had MIXXX, the ramp of that. a you you

of like to the some shallow the a how half? near what that the demand is I Like made? the and more a So this that half upside, of like you in relative interpret term, guess, Or step-up in second comment first Or seeing in both I second half that do before? forward is being is step-up? from the were it is pulled you

a pull demand. it's don't of Stacy. forward Sure, I think

it is qualify and see we get take what think -- long to would to workloads their want how performance. I is, wanted it we fully for customers

actual work quarter a it's engineering So that on that a now seen it, really call the well. we've And done. we're, later, let's that depends gone lot that's

to a MIXXXs forecast. So better original significant And their gaining a signals number it's actually are year. a ability as deploy seen confidence bit than customers of gone we've our and this stronger demand in result,

Got it.

I Matt's to follow-up, a ask directly. my question For want little more

servers hardware Like answer like billion as quite chips? it. there, that and in is number number? got and that stuff that didn't that in in silicon Or that well? $XXX you've number You is just The what's out there

answer thought I is chips. It answered it systems. I had But It it. not yes, accelerator is I'll again. Yes.

GPUs, types are ASICs think includes be the So memory as includes will it packaged GPUs. those things obviously, of and there, with that that but of other together -- it things,

significant, it right? So portion is of too. quite a memory Yes, big be memory will

question And the final line Citi. Danely comes the of from Chris with

Lisa. a guess question I for

As a be have ramps, how you say, half MIXXX the revenue digits double that X see in are X customers X think totally think year are Or or will do concentration, it let's revenue? the you from or X customer now? you'll do Do or fragmented? X that or you

that the it I are be don't X revenue, X or half Chris. think will

adoption. we're the a happy see I broad as of -- really, sort building think this to we're

than think don't concentration you sort others, the are mentioned. the see or you of we cloud of X with see always, that of partners, higher As but large might that sort type X I

sort to road TSMC. follow of just map then on up And Intel's Great. on question else's somebody versus

we've years. I all close with happen So couple over seen next open to map, up you with Intel maintain foundry I'm do over the your they'll sure road mean Intel the think able of do expect think you're is what of somewhat manufacturing the they couple Or years? gap the on to TSMC's to be intimately kimono familiar next going you lead? and the

our very next of I I'd the our happens few what about Yes. I of But partnership in to They said with what the feel over TSMC. other of well. put like we see years. CPUs, process entire at GPUs, things and continue map together reemphasize solve them feel architectural very extremely even of all problems. portfolio We'll road parity, add good DPUs, Look, our look kind and as execute to of earlier, to SoCs adaptive case we that we kind good the about

what really we we think customers. good our do feel with I can about

race, we So on we're paying the strategy good computing be always how of we feel very and push think I road our continue envelope of process do attention sort maps. about to sort but sort going the of the to to

is question-and-answer floor turn to over Okay. to end of for And the comments. that the I back the would the like session. team closing AMD any

us That Great, call. Thank to John. concludes today's for everyone today. you joining

And this concludes teleconference. today's

this Thank time. you at disconnect participation. may You your your lines for