corporate.pressinquiry@amd.com
AMD delivers record quarter as Data Center segment revenue grows 97% year-over- year, driven by record sales of AMD Instinct GPUs and AMD EPYC CPUs
AMD (NASDAQ:AMD) today announced financial results for the third quarter of 2026. Third quarter revenue was $13.4 billion, gross margin was 54%, operating income was $2.8 billion, net income was $2.4 billion and diluted earnings per share was $1.46. On a non-GAAP(*) basis, gross margin was 56%, operating income was $3.9 billion, net income was $3.5 billion and diluted earnings per share was $2.09.
“We delivered a record quarter with revenue exceeding the high end of our guidance as Data Center segment sales nearly doubled year-over-year,” said Dr. Lisa Su, AMD chair and CEO. “Demand for our Instinct and EPYC products continued to strengthen, and we expect growth to accelerate further in the fourth quarter as we scale Helios and ‘Venice’ production. With our leadership product portfolio and deep customer and supply chain relationships, we are confident in our ability to sustain very strong revenue growth and expanding profitability over the coming years.”
“Third quarter revenue grew 45% year-over-year to a record $13.4 billion, while non-GAAP earnings per share grew 74%, demonstrating the significant operating leverage in our business model as our Data Center business drives scale,” said Jean Hu, AMD executive vice president, chief financial officer and treasurer. “Our fourth-quarter outlook reflects accelerating revenue and earnings growth, driven by strong demand across our Data Center portfolio.” 1
• Data Center segment revenue was a record $8.5 billion, up 97% year-over-year, driven by strong demand for AMD EPYC™ processors and the launch of AMD Instinct™ MI450 Series GPUs.
• Client and Gaming segment revenue was $3.7 billion, down 8% year-over-year. Client business revenue was $2.9 billion, up 7% year-over-year, driven by sales of AMD Ryzen™ mobile processors. Gaming business revenue was $773 million, down 40% year-over-year, due to lower semi-custom and graphics revenue.
• Embedded segment revenue was $1.1 billion, up 29% year-over-year, led by growth in aerospace and defense, automotive, communications and industrial end markets.
• AMD solutions and software are powering superintelligence infrastructure at scale:
◦ Anthropic, Meta, Microsoft, OpenAI and Oracle Cloud Infrastructure are running models and workloads on the first AMD Helios ™ rackscale solutions, powered by AMD Instinct MI450 Series GPUs and 6 th Gen AMD EPYC CPUs.
◦ Oracle Cloud Infrastructure announced its OCI Compute E7 cloud compute instances will be powered by 6 th Gen AMD EPYC CPUs, supporting enterprise applications and the CPU services surrounding models. 2 ◦ AMD introduced the AMD Helion reference architecture, an open, flexible blueprint for building rack-scale agentic systems that lets customers configure the mix of CPUs and GPUs based on their workloads.
◦ AMD ROCm™ 10 was released , bringing AI-native developer experiences to AMD platforms with ROCm.AI, along with performance improvements and updated libraries, compilers, frameworks, tools and model support.
◦ The EuroHPC JU selected AMD Instinct MI430X GPUs and 6 th Gen AMD EPYC processors to power the LUMI-AI supercomputer.
◦ Google Cloud and Microsoft announced general availability of storage-optimized cloud instances powered by 5 th Gen AMD EPYC CPUs.
• AMD is expanding its capabilities across the full superintelligence stack through strategic acquisitions:
◦ AMD announced an agreement to acquire World Labs , bringing leading model research expertise to AMD to help shape superintelligence infrastructure and strengthen the open ecosystem.
◦ AMD announced an agreement to acquire Taalas , adding specialized inference silicon technology to further differentiate AMD system-level solutions and deliver breakthrough inference performance and efficiency.
• AMD advanced its adaptive and embedded portfolio and expanded its role in physical AI systems:
◦ AMD began sampling the AMD Versal™ AI Core XQRVC1902 space-grade adaptive SoC designed to support missions lasting up to 15 years.
◦ Kodiak AI announced that its next generation autonomous truck platform is powered by AMD EPYC processors.
◦ AMD introduced AMD Ross™, an agentic tool for embedded system design that helps customers accelerate time to market and improve performance for AMD embedded solutions.
◦ The AMD Ryzen™ AI Halo platform powered by Ryzen™ AI Max PRO 400 Series processors is now available , bringing the performance, memory and software ecosystem developers and creators need to build and run models locally.
◦ HP, Lenovo, Framework and GMKtec expanded availability of systems powered by AMD Ryzen™ AI Max PRO 400 Series processors.
◦ AMD debuted the Threadripper Halo Station, powered by the AMD Threadripper 9955WX CPU and AMD Instinct MI350p GPU, able to run trillion-parameter models locally.
AMD’s outlook statements are based on current expectations. The following statements are forward-looking and actual results could differ materially depending on market conditions and the factors set forth under “Cautionary Statement” below. 3 For the fourth quarter of 2026, AMD expects revenue to be approximately $17 billion, plus or minus 3%. The mid-point of the revenue range represents year- over-year growth of approximately 66% and a sequential increase of approximately 27%. Non-GAAP gross margin is expected to be approximately 55%.
AMD will hold a conference call at 2:00 p.m. PT (5:00 p.m. ET) today to discuss its third quarter 2026 financial results. AMD will provide a real-time audio broadcast of the teleconference on the Investor Relations page of its website at www.amd.com . 4
RECONCIL… OF GAAP TO NON-GAAP FINANCIAL MEASURES (in millions, except per share data and Three September September percenta… Months 26, June 27, 27, (Unaudit… Ended 2026 2026 2025 ────────────────────────────────────────────────────────────────────────────── GAAP gross $ 7,210 $ 6,203 $ 4,780 profit GAAP gross 54 % 54 % 52 % margin Stock-ba… 9 8 7 compensa… Amortiza… of 257 260 260 acquisit… intangib… Recovery of inventory — — -67 loss at contract manufact… Loss continge… 7 17 12 on legal matters Non-GAAP gross $ 7,483 $ 6,488 $ 4,992 profit Non-GAAP gross 56 % 56 % 54 % margin GAAP operating $ 4,378 $ 4,213 $ 3,510 expenses GAAP operating 33 % 37 % 38 % expenses… % Stock-ba… 514 495 412 compensa… Amortiza… of 277 284 302 acquisit… intangib… Acquisit… and other 27 40 42 costs(2) Non-GAAP operating $ 3,560 $ 3,394 $ 2,754 expenses Non-GAAP operating 27 % 29 % 30 % expenses… % GAAP operating $ 2,832 $ 1,990 $ 1,270 income GAAP operating 21 % 17 % 14 % margin Stock-ba… 523 503 419 compensa… Amortiza… of 534 544 562 acquisit… intangib… Recovery of inventory — — -67 loss at contract manufact… Acquisit… and other 27 40 42 costs(2) Loss continge… 7 17 12 on legal matters Non-GAAP operating $ 3,923 $ 3,094 $ 2,238 income Non-GAAP operating 29 % 27 % 24 % margin
Recovery of inventory loss at contract manufacturer was related to (1) the recovery of losses incurred as a result of an incident at a third-party contract manufacturing facility that occurred in Q1'24. Acquisition-related and other costs primarily included transaction (2) costs, purchase price fair value adjustments for inventory, certain compensation charges, and workforce rebalancing charges. Change in fair value of warrant liability relating to the quarterly (3) remeasurement of warrants issued to certain customers is driven by changes in AMD’s stock price and other valuation assumptions. Loss (income) from discontinued operations pertained to ZT Systems' (4) manufacturing business which was divested in Q4'25 and included the impact from measurement period adjustments in Q1'26.
AMD (NASDAQ: AMD) drives innovation in high-performance and AI computing to solve the world’s most important challenges. Today, AMD technology powers billions of experiences across cloud and AI infrastructure, embedded systems, AI PCs and gaming. With a broad portfolio of AI-optimized CPUs, GPUs, networking and software, AMD delivers full-stack AI solutions that provide the performance and scalability needed for a new era of intelligent computing. Learn more at www.amd.com .
This press release contains forward-looking statements concerning Advanced Micro Devices, Inc. (AMD) such as, expectations for revenue and earnings growth to accelerate in the fourth quarter of 2026; AMD’s ability to sustain very strong revenue growth and earnings profitability over the coming years; AMD’s business model and expectations regarding operating leverage and scale in its Data Center business; AMD’s anticipated demand across its Data Center portfolio and scaling production of Helios and “Venice”; the expected plans, benefits and timing of AMD’s strategic collaborations, including with Anthropic, Meta, Microsoft, OpenAI, Oracle Cloud Infrastructure, HPE and Kodiak AI; the expected timing, completion and benefits of AMD’s proposed acquisitions of World Labs and Taalas; the features, functionality, performance, availability, timing and expected benefits of future AMD products; and AMD’s expected fourth quarter 2026 financial outlook, including revenue and non-GAAP gross margin, which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are commonly identified by words such as "would," "may," "expects," "believes," "plans," "intends," "projects" and other terms with similar meaning. Investors are cautioned that the forward- looking statements in this press release are based on current beliefs, assumptions and expectations, speak only as of the date of this press release and involve risks and uncertainties that could cause actual results to differ materially from current expectations. Such statements are subject to certain known and unknown risks and uncertainties, many of which are difficult to predict and are generally beyond AMD’s control, that could cause actual results and other future events to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. Material factors that could cause actual results to differ materially from current expectations include, without limitation, the following: impact of government actions and regulations such as export regulations, national-security-based regulations, import tariffs, trade protection measures, and licensing requirements; competitive markets in which AMD’s products are sold; the cyclical nature of the semiconductor industry; market conditions of the industries in which AMD products are sold; AMD's ability to introduce products on a timely basis with expected features and performance levels; loss of a significant customer; economic and market uncertainty; quarterly and seasonal sales patterns; AMD's ability to adequately protect its technology or other intellectual property; unfavorable currency exchange rate fluctuations; ability of third party manufacturers to manufacture AMD's products on a timely basis in sufficient quantities and using competitive technologies; availability of essential equipment, materials, components (such as memory supply), substrates or manufacturing processes; ability to achieve expected manufacturing yields for AMD’s products; AMD's ability to generate revenue from its semi-custom SoC products; potential security vulnerabilities; potential security incidents including IT outages, data loss, data breaches and cyberattacks; uncertainties involving the ordering and shipment of AMD’s products; AMD’s reliance on third- party intellectual property to design and introduce new products; AMD's reliance on third-party companies for design, manufacture and supply of motherboards, software, memory and other computer platform components; AMD's reliance on Microsoft and other software vendors' support to design and develop software to run on AMD’s products; AMD’s reliance on third-party distributors and add-in- board partners; impact of modification or interruption of AMD’s internal business processes and information systems; compatibility of AMD’s products with some or all industry-standard software and hardware; costs related to defective products; failure to maintain an efficient supply chain as customer demand changes; AMD's ability to rely on third party supply-chain logistics functions; AMD’s ability to effectively control sales of its products on the gray market; impact of climate 6 change on AMD’s business; AMD’s ability to realize its deferred tax assets; potential tax liabilities; current and future claims and litigation; impact of environmental laws, conflict minerals related provisions and other laws or regulations; evolving expectations from governments, investors, customers and other stakeholders regarding corporate responsibility matters; issues related to the responsible use of AI; restrictions imposed by agreements governing AMD’s notes, the guarantees of Xilinx’s notes and the revolving credit agreement; AMD’s ability to satisfy financial obligations under guarantees, leases and other commercial commitments; impact of acquisitions, joint ventures and/or investments on AMD’s business and AMD’s ability to integrate acquired businesses; impact of any impairment of the combined company’s assets; political, legal and economic risks and natural disasters; future impairments of technology license purchases; AMD’s ability to attract and retain key employees; and AMD’s stock price volatility, including the potential impact on the fair value of customer warrants and AMD's GAAP earnings . Investors are urged to review in detail the risks and uncertainties in AMD’s Securities and Exchange Commission filings, including but not limited to AMD’s most recent reports on Forms 10-K and 10-Q.
In this earnings press release, in addition to GAAP financial results, AMD has provided non-GAAP financial measures including non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating expenses/revenue percent, non-GAAP operating income, non-GAAP operating margin, non-GAAP net income and non-GAAP diluted earnings per share. AMD uses a normalized tax rate in its computation of the non-GAAP income tax provision to provide better consistency across the reporting periods. For fiscal 2026, AMD uses a projected non-GAAP tax rate of 13%, which excludes the tax impact of pre-tax non-GAAP adjustments. AMD also provides adjusted EBITDA, free cash flow and free cash flow margin as supplemental non-GAAP measures of its performance. These items are defined in the footnotes to the selected corporate data tables provided at the end of this earnings press release. AMD is providing these financial measures because it believes this non-GAAP presentation makes it easier for investors to compare its operating results for current and historical periods and also because AMD believes it assists investors in comparing AMD’s performance across reporting periods on a consistent basis by excluding items that it does not believe are indicative of its core operating performance and for the other reasons described in the footnotes to the selected data tables. The non-GAAP financial measures disclosed in this earnings press release should be viewed in addition to and not as a substitute for or superior to AMD’s reported results prepared in accordance with GAAP and should be read only in conjunction with AMD’s Consolidated Financial Statements prepared in accordance with GAAP. These non-GAAP financial measures referenced are reconciled to their most directly comparable GAAP financial measures in the data tables in this earnings press release. This earnings press release also contains forward-looking non-GAAP gross margin concerning AMD’s financial outlook, which is based on current expectations as of November 3, 2026, and assumptions and beliefs that involve numerous risks and uncertainties. Adjustments to arrive at the GAAP gross margin outlook typically include stock-based compensation, amortization of acquired intangible assets and acquisition-related and other costs. The timing and impact of such adjustments are dependent on future events that are typically uncertain or outside of AMD's control, therefore, a reconciliation to equivalent GAAP measures is not practicable at this time. AMD undertakes no intent or obligation to publicly update or revise its outlook statements as a result of new information, future (*) events or otherwise, except as may be required by law. ──────────────────────────────────────────────────────────────────────────────
-30- ©2026 Advanced Micro Devices, Inc. All rights reserved. AMD, the AMD Arrow logo, 3D V-Cache, Alveo, Instinct, EPYC, ROCm, FidelityFX, Helios, Kria, Radeon, Ryzen, Threadripper, Ultrascale+, Versal, Zynq, and combinations thereof, are trademarks of Advanced Micro Devices, Inc. 7
September 26, December 27, 2026 2025 ────────────────────────────────────────────────────────────────────────────── -Unaudited ASSETS Current assets: Cash and cash equivalents $ 7,404 $ 5,539 Short-term investments 8,372 5,013 Accounts receivable, net 9,209 6,315 Inventories 11,463 7,920 Prepaid expenses and other current 3,023 2,160 assets Total current assets 39,471 26,947 Property and equipment, net 3,929 2,312 Goodwill 25,470 25,126 Acquisition-related 15,101 16,705 intangibles, net Deferred tax assets 821 384 Other non-current assets 10,020 5,452 Total Assets $ 94,812 $ 76,926 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 7,756 $ 2,929 Accrued liabilities 6,231 5,250 Current portion of — 874 long-term debt, net Other current liabilities 499 402 Total current liabilities 14,486 9,455 Long-term debt 7,079 2,348 Long-term operating lease 1,837 625 liabilities Deferred tax liabilities 295 313 Other long-term liabilities 2,726 1,186 Stockholders' equity: Capital stock: Common stock, par value 16 17 $0.01 Additional paid-in capital 61,769 63,365 Treasury stock, at cost — -7,079 Retained earnings 6,720 6,699 Accumulated other -116 -3 comprehensive loss Total stockholders' equity 68,389 62,999 Total Liabilities and Stockholders' $ 94,812 $ 76,926 Equity
The Company operates as three operating segments, Data Center, Client and Gaming, and Embedded segments. The Data Center segment primarily includes Artificial Intelligence (AI) accelerators, microprocessors (CPUs) for servers, graphics processing units (GPUs), accelerated processing units (APUs), data processing units (DPUs), AI Network Interface Cards (AI NICs), Field Programmable Gate Arrays (FPGAs) and adaptive System-on-Chip (SoC) products for data centers. The Client and Gaming segment primarily includes CPUs, APUs, chipsets (1) for desktops and notebooks, discrete GPUs, and semi-custom SoC products and development services. The Embedded segment primarily includes embedded CPUs, APUs, FPGAs, System on Modules (SOMs), and adaptive SoC products. From time to time, the Company may also sell or license portions of its IP portfolio. All Other category primarily includes certain expenses and credits that are not allocated to any of the operating segments, such as amortization of acquisition-related intangibles, employee stock-based compensation expense, and acquisition-related and other costs.
The Company presents “Adjusted EBITDA” as a supplemental measure of its performance. Adjusted EBITDA for the Company is determined by adjusting GAAP net income for interest expense, other (income) expense, net, income tax provision (benefit), equity income in investee, stock-based compensation, depreciation and amortization expense, amortization of acquisition-related intangibles, acquisition-related and other costs, recovery of inventory loss at contract manufacturer, loss contingency on legal matters, and loss (income) from discontinued operations, net of tax. The Company calculates and presents Adjusted EBITDA because management believes it is of importance to investors and lenders in relation to its overall capital structure and its ability to borrow additional funds. In addition, the Company presents Adjusted EBITDA because it believes this measure assists investors in comparing its performance across reporting periods on a consistent basis by excluding items that the Company does not believe are indicative of its core operating performance. The Company’s calculation of Adjusted EBITDA may or may not be consistent with the calculation of this measure by other companies in the same industry. Investors should not view Adjusted EBITDA as an alternative to the GAAP operating measure of net income or GAAP liquidity measures of cash flows from operating, investing and financing activities. In addition, Adjusted EBITDA does not take into account changes in certain assets and liabilities that can affect cash flows.
(3) Reconciliation of GAAP Net Cash Provided by Operating Activities of Continuing Operations to Free Cash Flow
The Company also presents free cash flow as a supplemental Non-GAAP measure of its performance. Free cash flow is determined by adjusting GAAP net cash provided by operating activities of continuing operations for capital expenditures, and free cash flow margin % is free cash flow expressed as a percentage of the Company's net revenue. The Company calculates and communicates free cash flow in the financial earnings press release because management believes it is of importance to investors to understand the nature of these cash flows. The Company’s calculation of free cash flow may or may not be consistent with the calculation of this measure by other companies in the same industry. Investors should not view free cash flow as an alternative to GAAP liquidity measures of cash flows from operating activities.
Full text with the tables
NEWS RELEASE
Contact
Carolyn Guss
AMD Communications
corporate.pressinquiry@amd.com
Liz Stine
AMD Investor Relations
investor.relations@amd.com
AMD Reports Third Quarter 2026 Financial Results
AMD delivers record quarter as Data Center segment revenue grows 97% year-over-
year, driven by record sales of AMD Instinct GPUs and AMD EPYC CPUs
SANTA CLARA, Calif. ― November 3, 2026 ―
AMD (NASDAQ:AMD) today announced financial results for the third quarter of
2026. Third quarter revenue was $13.4 billion, gross margin was 54%, operating
income was $2.8 billion, net income was $2.4 billion and diluted earnings per
share was $1.46. On a non-GAAP(*) basis, gross margin was 56%, operating income
was $3.9 billion, net income was $3.5 billion and diluted earnings per share was
$2.09.
“We delivered a record quarter with revenue exceeding the high end of our
guidance as Data Center segment sales nearly doubled year-over-year,” said Dr.
Lisa Su, AMD chair and CEO. “Demand for our Instinct and EPYC products continued
to strengthen, and we expect growth to accelerate further in the fourth quarter
as we scale Helios and ‘Venice’ production. With our leadership product
portfolio and deep customer and supply chain relationships, we are confident in
our ability to sustain very strong revenue growth and expanding profitability
over the coming years.”
“Third quarter revenue grew 45% year-over-year to a record $13.4 billion, while
non-GAAP earnings per share grew 74%, demonstrating the significant operating
leverage in our business model as our Data Center business drives scale,” said
Jean Hu, AMD executive vice president, chief financial officer and treasurer.
“Our fourth-quarter outlook reflects accelerating revenue and earnings growth,
driven by strong demand across our Data Center portfolio.”
1
GAAP Quarterly Financial Results
Q3'26 Q3'25 Y/Y Q2'26 Q/Q
Revenue ($M) $13,377 $9,246 Up 45% $11,536 Up 16%
Gross profit ($M) $7,210 $4,780 Up 51% $6,203 Up 16%
Gross margin 54% 52% Up 2 ppts 54% Flat
Operating expenses $4,378 $3,510 Up 25% $4,213 Up 4%
($M)
Operating income $2,832 $1,270 Up 123% $1,990 Up 42%
($M)
Operating margin 21% 14% Up 7 ppts 17% Up 4 ppts
Net income ($M) $2,428 $1,243 Up 95% $2,297 Up 6%
Diluted earnings $1.46 $0.75 Up 95% $1.38 Up 6%
per share
Non-GAAP(*) Quarterly Financial Results
Q3'26 Q3'25 Y/Y Q2'26 Q/Q
Revenue ($M) $13,377 $9,246 Up 45% $11,536 Up 16%
Gross profit ($M) $7,483 $4,992 Up 50% $6,488 Up 15%
Gross margin 56% 54% Up 2 ppts 56% Flat
Operating expenses $3,560 $2,754 Up 29% $3,394 Up 5%
($M)
Operating income $3,923 $2,238 Up 75% $3,094 Up 27%
($M)
Operating margin 29% 24% Up 5 ppts 27% Up 2 ppts
Net income ($M) $3,471 $1,965 Up 77% $2,760 Up 26%
Diluted earnings $2.09 $1.20 Up 74% $1.66 Up 26%
per share
Segment Summary
• Data Center segment revenue was a record $8.5 billion, up 97% year-over-year,
driven by strong demand for AMD EPYC™ processors and the launch of AMD Instinct™
MI450 Series GPUs.
• Client and Gaming segment revenue was $3.7 billion, down 8% year-over-year.
Client business revenue was $2.9 billion, up 7% year-over-year, driven by sales
of AMD Ryzen™ mobile processors. Gaming business revenue was $773 million, down
40% year-over-year, due to lower semi-custom and graphics revenue.
• Embedded segment revenue was $1.1 billion, up 29% year-over-year, led by
growth in aerospace and defense, automotive, communications and industrial end
markets.
Recent Highlights
• AMD solutions and software are powering superintelligence infrastructure at
scale:
◦ Anthropic, Meta, Microsoft, OpenAI and Oracle Cloud Infrastructure are running
models and workloads on the first AMD Helios ™ rackscale solutions, powered by
AMD Instinct MI450 Series GPUs and 6 th Gen AMD EPYC CPUs.
◦ HPE announced that Vultr will deploy the first AMD Helios by HPE systems.
◦ Oracle Cloud Infrastructure announced its OCI Compute E7 cloud compute
instances will be powered by 6 th Gen AMD EPYC CPUs, supporting enterprise
applications and the CPU services surrounding models.
2
◦ AMD introduced the AMD Helion reference architecture, an open, flexible
blueprint for building rack-scale agentic systems that lets customers configure
the mix of CPUs and GPUs based on their workloads.
◦ AMD ROCm™ 10 was released , bringing AI-native developer experiences to AMD
platforms with ROCm.AI, along with performance improvements and updated
libraries, compilers, frameworks, tools and model support.
◦ The EuroHPC JU selected AMD Instinct MI430X GPUs and 6 th Gen AMD EPYC
processors to power the LUMI-AI supercomputer.
◦ Google Cloud and Microsoft announced general availability of storage-optimized
cloud instances powered by 5 th Gen AMD EPYC CPUs.
• AMD is expanding its capabilities across the full superintelligence stack
through strategic acquisitions:
◦ AMD announced an agreement to acquire World Labs , bringing leading model
research expertise to AMD to help shape superintelligence infrastructure and
strengthen the open ecosystem.
◦ AMD announced an agreement to acquire Taalas , adding specialized inference
silicon technology to further differentiate AMD system-level solutions and
deliver breakthrough inference performance and efficiency.
• AMD advanced its adaptive and embedded portfolio and expanded its role in
physical AI systems:
◦ AMD began sampling the AMD Versal™ AI Core XQRVC1902 space-grade adaptive SoC
designed to support missions lasting up to 15 years.
◦ Kodiak AI announced that its next generation autonomous truck platform is
powered by AMD EPYC processors.
◦ AMD introduced AMD Ross™, an agentic tool for embedded system design that
helps customers accelerate time to market and improve performance for AMD
embedded solutions.
• AMD expanded its PC offerings for local agentic superintelligence and gaming:
◦ The AMD Ryzen™ AI Halo platform powered by Ryzen™ AI Max PRO 400 Series
processors is now available , bringing the performance, memory and software
ecosystem developers and creators need to build and run models locally.
◦ HP, Lenovo, Framework and GMKtec expanded availability of systems powered by
AMD Ryzen™ AI Max PRO 400 Series processors.
◦ AMD debuted the Threadripper Halo Station, powered by the AMD Threadripper
9955WX CPU and AMD Instinct MI350p GPU, able to run trillion-parameter models
locally.
Current Outlook
AMD’s outlook statements are based on current expectations. The following
statements are forward-looking and actual results could differ materially
depending on market conditions and the factors set forth under “Cautionary
Statement” below.
3
For the fourth quarter of 2026, AMD expects revenue to be approximately $17
billion, plus or minus 3%. The mid-point of the revenue range represents year-
over-year growth of approximately 66% and a sequential increase of approximately
27%. Non-GAAP gross margin is expected to be approximately 55%.
AMD Teleconference
AMD will hold a conference call at 2:00 p.m. PT (5:00 p.m. ET) today to discuss
its third quarter 2026 financial results. AMD will provide a real-time audio
broadcast of the teleconference on the Investor Relations page of its website at
www.amd.com .
4
RECONCIL…
OF GAAP
TO
NON-GAAP
FINANCIAL
MEASURES
(in
millions,
except
per share
data and Three September September
percenta… Months 26, June 27, 27,
(Unaudit… Ended 2026 2026 2025
──────────────────────────────────────────────────────────────────────────────
GAAP
gross $ 7,210 $ 6,203 $ 4,780
profit
GAAP
gross 54 % 54 % 52 %
margin
Stock-ba… 9 8 7
compensa…
Amortiza…
of 257 260 260
acquisit…
intangib…
Recovery
of
inventory — — -67
loss at
contract
manufact…
Loss
continge… 7 17 12
on legal
matters
Non-GAAP
gross $ 7,483 $ 6,488 $ 4,992
profit
Non-GAAP
gross 56 % 56 % 54 %
margin
GAAP
operating $ 4,378 $ 4,213 $ 3,510
expenses
GAAP
operating 33 % 37 % 38 %
expenses…
%
Stock-ba… 514 495 412
compensa…
Amortiza…
of 277 284 302
acquisit…
intangib…
Acquisit…
and other 27 40 42
costs(2)
Non-GAAP
operating $ 3,560 $ 3,394 $ 2,754
expenses
Non-GAAP
operating 27 % 29 % 30 %
expenses…
%
GAAP
operating $ 2,832 $ 1,990 $ 1,270
income
GAAP
operating 21 % 17 % 14 %
margin
Stock-ba… 523 503 419
compensa…
Amortiza…
of 534 544 562
acquisit…
intangib…
Recovery
of
inventory — — -67
loss at
contract
manufact…
Acquisit…
and other 27 40 42
costs(2)
Loss
continge… 7 17 12
on legal
matters
Non-GAAP
operating $ 3,923 $ 3,094 $ 2,238
income
Non-GAAP
operating 29 % 27 % 24 %
margin
Thr… Sept… June Sept…
Mon… 26, 27, 27,
End… 2026 2026 2025
──────────────────────────────────────────────────────────────────────────────
GAAP
net
inc…
/ $ 2,428 $ 1.46 $ 2,297 $ 1.38 $ 1,243 $ 0.75
ear…
per
sha…
Sto… 523 0.31 503 0.30 419 0.26
com…
Amo…
of 534 0.32 544 0.33 562 0.34
acq…
int…
Rec…
of
inv…
loss — — — — -67 -0.…
at
con…
man…
Acq…
and 27 0.02 41 0.02 43 0.03
oth…
cos…
Loss
con…
on 7 — 17 0.01 12 0.01
leg…
mat…
(Ga…
loss
on -67 -0.… -483 -0.… -26 -0.…
lon…
inv…
net
Cha…
in
fair
val… 1,097 0.66 — — — —
of
war…
lia…
Equ…
inc… -5 — -6 — -10 —
in
inv…
Inc…
tax -1,0… -0.… -161 -0.… -140 -0.…
pro…
Loss
(in…
from
dis… — — 8 0.01 -71 -0.…
ope…
net
of
tax…
Non…
net
inc…
/ $ 3,471 $ 2.09 $ 2,760 $ 1.66 $ 1,965 $ 1.20
ear…
per
sha…
5
Recovery of inventory loss at contract manufacturer was related to
(1) the recovery of losses incurred as a result of an incident at a
third-party contract manufacturing facility that occurred in Q1'24.
Acquisition-related and other costs primarily included transaction
(2) costs, purchase price fair value adjustments for inventory, certain
compensation charges, and workforce rebalancing charges.
Change in fair value of warrant liability relating to the quarterly
(3) remeasurement of warrants issued to certain customers is driven by
changes in AMD’s stock price and other valuation assumptions.
Loss (income) from discontinued operations pertained to ZT Systems'
(4) manufacturing business which was divested in Q4'25 and included the
impact from measurement period adjustments in Q1'26.
About AMD
AMD (NASDAQ: AMD) drives innovation in high-performance and AI computing to
solve the world’s most important challenges. Today, AMD technology powers
billions of experiences across cloud and AI infrastructure, embedded systems, AI
PCs and gaming. With a broad portfolio of AI-optimized CPUs, GPUs, networking
and software, AMD delivers full-stack AI solutions that provide the performance
and scalability needed for a new era of intelligent computing. Learn more at
www.amd.com .
Cautionary Statement
This press release contains forward-looking statements concerning Advanced Micro
Devices, Inc. (AMD) such as, expectations for revenue and earnings growth to
accelerate in the fourth quarter of 2026; AMD’s ability to sustain very strong
revenue growth and earnings profitability over the coming years; AMD’s business
model and expectations regarding operating leverage and scale in its Data Center
business; AMD’s anticipated demand across its Data Center portfolio and scaling
production of Helios and “Venice”; the expected plans, benefits and timing of
AMD’s strategic collaborations, including with Anthropic, Meta, Microsoft,
OpenAI, Oracle Cloud Infrastructure, HPE and Kodiak AI; the expected timing,
completion and benefits of AMD’s proposed acquisitions of World Labs and Taalas;
the features, functionality, performance, availability, timing and expected
benefits of future AMD products; and AMD’s expected fourth quarter 2026
financial outlook, including revenue and non-GAAP gross margin, which are made
pursuant to the Safe Harbor provisions of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements are commonly identified by words
such as "would," "may," "expects," "believes," "plans," "intends," "projects"
and other terms with similar meaning. Investors are cautioned that the forward-
looking statements in this press release are based on current beliefs,
assumptions and expectations, speak only as of the date of this press release
and involve risks and uncertainties that could cause actual results to differ
materially from current expectations. Such statements are subject to certain
known and unknown risks and uncertainties, many of which are difficult to
predict and are generally beyond AMD’s control, that could cause actual results
and other future events to differ materially from those expressed in, or implied
or projected by, the forward-looking information and statements. Material
factors that could cause actual results to differ materially from current
expectations include, without limitation, the following: impact of government
actions and regulations such as export regulations, national-security-based
regulations, import tariffs, trade protection measures, and licensing
requirements; competitive markets in which AMD’s products are sold; the cyclical
nature of the semiconductor industry; market conditions of the industries in
which AMD products are sold; AMD's ability to introduce products on a timely
basis with expected features and performance levels; loss of a significant
customer; economic and market uncertainty; quarterly and seasonal sales
patterns; AMD's ability to adequately protect its technology or other
intellectual property; unfavorable currency exchange rate fluctuations; ability
of third party manufacturers to manufacture AMD's products on a timely basis in
sufficient quantities and using competitive technologies; availability of
essential equipment, materials, components (such as memory supply), substrates
or manufacturing processes; ability to achieve expected manufacturing yields for
AMD’s products; AMD's ability to generate revenue from its semi-custom SoC
products; potential security vulnerabilities; potential security incidents
including IT outages, data loss, data breaches and cyberattacks; uncertainties
involving the ordering and shipment of AMD’s products; AMD’s reliance on third-
party intellectual property to design and introduce new products; AMD's reliance
on third-party companies for design, manufacture and supply of motherboards,
software, memory and other computer platform components; AMD's reliance on
Microsoft and other software vendors' support to design and develop software to
run on AMD’s products; AMD’s reliance on third-party distributors and add-in-
board partners; impact of modification or interruption of AMD’s internal
business processes and information systems; compatibility of AMD’s products with
some or all industry-standard software and hardware; costs related to defective
products; failure to maintain an efficient supply chain as customer demand
changes; AMD's ability to rely on third party supply-chain logistics functions;
AMD’s ability to effectively control sales of its products on the gray market;
impact of climate
6
change on AMD’s business; AMD’s ability to realize its deferred tax assets;
potential tax liabilities; current and future claims and litigation; impact of
environmental laws, conflict minerals related provisions and other laws or
regulations; evolving expectations from governments, investors, customers and
other stakeholders regarding corporate responsibility matters; issues related to
the responsible use of AI; restrictions imposed by agreements governing AMD’s
notes, the guarantees of Xilinx’s notes and the revolving credit agreement;
AMD’s ability to satisfy financial obligations under guarantees, leases and
other commercial commitments; impact of acquisitions, joint ventures and/or
investments on AMD’s business and AMD’s ability to integrate acquired
businesses; impact of any impairment of the combined company’s assets;
political, legal and economic risks and natural disasters; future impairments of
technology license purchases; AMD’s ability to attract and retain key employees;
and AMD’s stock price volatility, including the potential impact on the fair
value of customer warrants and AMD's GAAP earnings . Investors are urged to
review in detail the risks and uncertainties in AMD’s Securities and Exchange
Commission filings, including but not limited to AMD’s most recent reports on
Forms 10-K and 10-Q.
In this earnings press release, in addition to GAAP financial
results, AMD has provided non-GAAP financial measures including
non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating
expenses, non-GAAP operating expenses/revenue percent, non-GAAP
operating income, non-GAAP operating margin, non-GAAP net income and
non-GAAP diluted earnings per share. AMD uses a normalized tax rate
in its computation of the non-GAAP income tax provision to provide
better consistency across the reporting periods. For fiscal 2026, AMD
uses a projected non-GAAP tax rate of 13%, which excludes the tax
impact of pre-tax non-GAAP adjustments. AMD also provides adjusted
EBITDA, free cash flow and free cash flow margin as supplemental
non-GAAP measures of its performance. These items are defined in the
footnotes to the selected corporate data tables provided at the end
of this earnings press release. AMD is providing these financial
measures because it believes this non-GAAP presentation makes it
easier for investors to compare its operating results for current and
historical periods and also because AMD believes it assists investors
in comparing AMD’s performance across reporting periods on a
consistent basis by excluding items that it does not believe are
indicative of its core operating performance and for the other
reasons described in the footnotes to the selected data tables. The
non-GAAP financial measures disclosed in this earnings press release
should be viewed in addition to and not as a substitute for or
superior to AMD’s reported results prepared in accordance with GAAP
and should be read only in conjunction with AMD’s Consolidated
Financial Statements prepared in accordance with GAAP. These non-GAAP
financial measures referenced are reconciled to their most directly
comparable GAAP financial measures in the data tables in this
earnings press release. This earnings press release also contains
forward-looking non-GAAP gross margin concerning AMD’s financial
outlook, which is based on current expectations as of November 3,
2026, and assumptions and beliefs that involve numerous risks and
uncertainties. Adjustments to arrive at the GAAP gross margin outlook
typically include stock-based compensation, amortization of acquired
intangible assets and acquisition-related and other costs. The timing
and impact of such adjustments are dependent on future events that
are typically uncertain or outside of AMD's control, therefore, a
reconciliation to equivalent GAAP measures is not practicable at this
time. AMD undertakes no intent or obligation to publicly update or
revise its outlook statements as a result of new information, future
(*) events or otherwise, except as may be required by law.
──────────────────────────────────────────────────────────────────────────────
-30-
©2026 Advanced Micro Devices, Inc. All rights reserved. AMD, the AMD Arrow logo,
3D V-Cache, Alveo, Instinct, EPYC, ROCm, FidelityFX, Helios, Kria, Radeon,
Ryzen, Threadripper, Ultrascale+, Versal, Zynq, and combinations thereof, are
trademarks of Advanced Micro Devices, Inc.
7
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Millions except per share amounts and percentages) (Unaudited)
Thr… Sep… Ju… Sep… Ni… Sep… Se…
Mon… 26, 27, 27, Mo… 26, 27,
End… 2026 20… 2025 En… 2026 20…
──────────────────────────────────────────────────────────────────────────────
Net $ 13,… $ 11… $ 9,2… $ 35,… $ 24…
re…
Co…
of 5,9… 5,… 4,2… 15,… 12…
sa…
Am…
of 257 260 260 778 771
ac…
in…
To…
co… 6,1… 5,… 4,4… 16,… 12…
of
sa…
Gr… 7,2… 6,… 4,7… 18,… 11…
pr…
Gr… 54 % 54 % 52 % 54 % 47 %
ma…
Re…
and 2,8… 2,… 2,1… 7,7… 5,…
de…
Ma…
ge… 1,2… 1,… 1,0… 3,9… 2,…
and
ad…
Am…
of 277 284 302 851 926
ac…
in…
To…
op… 4,3… 4,… 3,5… 12,… 9,…
ex…
Op… 2,8… 1,… 1,2… 6,2… 1,…
in…
In… -62 -37 -37 -136 -95
ex…
Ot…
in… -902 598 82 -139 219
(e…
net
In…
fr…
co…
op…
be… 1,8… 2,… 1,3… 6,0… 2,…
in…
ta…
and
eq…
in…
In…
tax -555 252 153 -65 -5…
pr…
(b…
Eq…
in… 5 6 10 17 25
in
in…
In…
fr…
co…
op… 2,4… 2,… 1,1… 6,1… 2,…
net
of
tax
In…
(l…
fr…
di… — -8 71 3 175
op…
net
of
tax
Net $ 2,4… $ 2,… $ 1,2… $ 6,1… $ 2,…
in…
Ea…
per
sh…
Ba…
ea…
fr… $ 1.48 $ 1.… $ 0.72 $ 3.74 $ 1.…
co…
op…
Ba…
ea…
fr… $ — $ -0… $ 0.04 $ — $ 0.…
di…
op…
Ba…
ea… $ 1.48 $ 1.… $ 0.76 $ 3.74 $ 1.…
per
sh…
Di…
ea…
fr… $ 1.46 $ 1.… $ 0.71 $ 3.69 $ 1.…
co…
op…
Di…
ea…
fr… $ — $ -0… $ 0.04 $ — $ 0.…
di…
op…
Di…
ea… $ 1.46 $ 1.… $ 0.75 $ 3.69 $ 1.…
per
sh…
Sh…
us…
in
per
sh…
ca…
Ba… 1,6… 1,… 1,6… 1,6… 1,…
Di… 1,6… 1,… 1,6… 1,6… 1,…
8
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Millions)
September 26, December 27,
2026 2025
──────────────────────────────────────────────────────────────────────────────
-Unaudited
ASSETS
Current assets:
Cash and cash equivalents $ 7,404 $ 5,539
Short-term investments 8,372 5,013
Accounts receivable, net 9,209 6,315
Inventories 11,463 7,920
Prepaid expenses and other
current 3,023 2,160
assets
Total current assets 39,471 26,947
Property and equipment, net 3,929 2,312
Goodwill 25,470 25,126
Acquisition-related 15,101 16,705
intangibles, net
Deferred tax assets 821 384
Other non-current assets 10,020 5,452
Total Assets $ 94,812 $ 76,926
LIABILITIES AND
STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 7,756 $ 2,929
Accrued liabilities 6,231 5,250
Current portion of — 874
long-term debt, net
Other current liabilities 499 402
Total current liabilities 14,486 9,455
Long-term debt 7,079 2,348
Long-term operating lease 1,837 625
liabilities
Deferred tax liabilities 295 313
Other long-term liabilities 2,726 1,186
Stockholders' equity:
Capital stock:
Common stock, par value 16 17
$0.01
Additional paid-in capital 61,769 63,365
Treasury stock, at cost — -7,079
Retained earnings 6,720 6,699
Accumulated other -116 -3
comprehensive loss
Total stockholders' equity 68,389 62,999
Total Liabilities and
Stockholders' $ 94,812 $ 76,926
Equity
9
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Millions) (Unaudited)
Three Septe… Septe… Nine Septem… Septe…
Months 26, 27, Months 26, 27,
Ended 2026 2025 Ended 2026 2025
──────────────────────────────────────────────────────────────────────────────
Cash
flows
from
oper…
acti…
Net $ 2,428 $ 1,243 $ 6,108 $ 2,824
inco…
(Inc…
loss
from
disc… — -71 -3 -175
oper…
net
of
tax
Adju…
to
reco…
net
inco…
to
net
cash
prov…
by
oper…
acti…
Depr…
and 239 192 666 556
amor…
Amor…
of 534 562 1,629 1,697
acqu…
inta…
Stoc… 523 419 1,513 1,152
comp…
Gains
from
long… -67 -25 -616 -61
inve…
net
Non-…
impa…
of
warr… 1,179 — 1,179 —
issu…
to
cust…
net
Defe…
inco… -321 218 -427 18
taxes
Reco…
of
inve…
loss — -67 — -67
at
cont…
manu…
Other 44 25 105 90
Chan…
in
oper…
asse…
and
liab…
Acco…
rece… -1,928 -1,085 -2,894 -7
net
Inve… -2,995 -636 -3,543 -1,579
Prep…
expe…
and -1,070 118 -2,061 -259
other
asse…
Acco… 2,313 451 4,483 998
paya…
Accr…
and 323 444 384 -998
other
liab…
Net
cash
prov…
by
oper… 1,202 1,788 6,523 4,189
acti…
of
cont…
oper…
Net
cash
prov…
by
oper… — 371 — 920
acti…
of
disc…
oper…
Net
cash
prov… 1,202 2,159 6,523 5,109
by
oper…
acti…
Cash
flows
from
inve…
acti…
Purc…
of
prop… -648 -258 -1,845 -752
and
equi…
Purc…
of -2,199 -1,314 -6,754 -2,110
shor…
inve…
Proc…
from
matu… 1,777 299 3,044 982
of
shor…
inve…
Proc…
from
sale 80 18 366 66
of
shor…
inve…
Purc…
of -238 -74 -1,082 -432
long…
inve…
Acqu…
net
of — — -129 -1,716
cash
acqu…
Other -15 — -15 —
Net
cash
used
in
inve… -1,243 -1,329 -6,415 -3,962
acti…
of
cont…
oper…
Purc…
of
prop… — -8 — -30
and
equi…
Paym…
for
work…
capi… — — -243 —
adju…
on
dive…
Net
cash
used
in
inve… — -8 -243 -30
acti…
of
disc…
oper…
Net
cash
used -1,243 -1,337 -6,658 -3,992
in
inve…
acti…
Cash
flows
from
fina…
acti…
Proc…
from
debt
and
comm…
paper 4,726 — 4,726 2,441
issu…
net
of
issu…
costs
Repa…
of
debt -875 — -875 -950
and
comm…
paper
Proc…
from
sales
of
comm… 5 10 210 169
stock
thro…
empl…
equi…
plans
Repu…
of — -89 -221 -1,316
comm…
stock
Stock
repu…
for
tax
with… -1,495 -371 -1,836 -447
on
empl…
equi…
plans
Other -13 — -21 —
Net
cash
prov…
by 2,348 -450 1,983 -103
(used
in)
fina…
acti…
Net
incr…
in
cash,
cash 2,307 372 1,848 1,014
equi…
and
rest…
cash
Cash,
cash
equi…
and
rest… 5,097 4,453 5,556 3,811
cash
at
begi…
of
peri…
Cash,
cash
equi…
and
rest… $ 7,404 $ 4,825 $ 7,404 $ 4,825
cash
at
end
of
peri…
Reco…
of
cash,
cash
equi…
and
rest…
cash
Cash
and $ 7,404 $ 4,808 $ 7,404 $ 4,808
cash
equi…
Rest…
cash
incl…
in
Prep… — 17 — 17
expe…
and
other
curr…
asse…
Cash,
cash
equi…
and
rest… $ 7,404 $ 4,825 $ 7,404 $ 4,825
cash
at
end
of
peri…
10
ADVANCED MICRO DEVICES, INC.
SELECTED CORPORATE DATA
(Millions) (Unaudited)
Three Septe… June Septe… Nine Septe… Sept…
Mont… 26, 27, 27, Mont… 26, 27,
Ended 2026 2026 2025 Ended 2026 2025
──────────────────────────────────────────────────────────────────────────────
Segm…
and
Disa…
Reve…
Info…
Net
Reve…
Data
Cent… $ 8,546 $ 6,718 $ 4,341 $ 21,039 $ 11,2…
Segm…
Clie…
and
Gami…
Segm…
Clie… 2,949 3,062 2,750 8,896 7,543
Gami… 773 779 1,298 2,272 3,067
Total
Clie… 3,722 3,841 4,048 11,168 10,6…
and
Gami…
Embe… 1,109 977 857 2,959 2,504
Segm…
Total
net $ 13,377 $ 11,5… $ 9,246 $ 35,166 $ 24,3…
reve…
Oper…
Inco…
(Los…
Data
Cent… $ 2,882 $ 2,103 $ 1,074 $ 6,584 $ 1,851
Segm…
Clie…
and 573 582 867 1,730 2,130
Gami…
Segm…
Embe… 453 386 283 1,177 886
Segm…
All -1,076 -1,0… -954 -3,193 -2,9…
other
Total
oper… $ 2,832 $ 1,990 $ 1,270 $ 6,298 $ 1,942
inco…
Other
Data
Capi… $ 648 $ 808 $ 258 $ 1,845 $ 752
expe…
Adju… $ 4,162 $ 3,315 $ 2,430 $ 10,223 $ 5,470
EBIT…
Cash,
cash
equi… $ 15,776 $ 13,1… $ 7,243 $ 15,776 $ 7,243
and
shor…
inve…
Free
cash $ 554 $ 1,558 $ 1,530 $ 4,678 $ 3,437
flow…
Total $ 94,812 $ 84,4… $ 76,891 $ 94,812 $ 76,8…
asse…
Total $ 7,079 $ 3,226 $ 3,220 $ 7,079 $ 3,220
debt
The Company operates as three operating segments, Data Center, Client
and Gaming, and Embedded segments.
The Data Center segment primarily includes Artificial Intelligence
(AI) accelerators, microprocessors (CPUs) for servers, graphics
processing units (GPUs), accelerated processing units (APUs), data
processing units (DPUs), AI Network Interface Cards (AI NICs), Field
Programmable Gate Arrays (FPGAs) and adaptive System-on-Chip (SoC)
products for data centers.
The Client and Gaming segment primarily includes CPUs, APUs, chipsets
(1) for desktops and notebooks, discrete GPUs, and semi-custom SoC
products and development services.
The Embedded segment primarily includes embedded CPUs, APUs, FPGAs,
System on Modules (SOMs), and adaptive SoC products.
From time to time, the Company may also sell or license portions of
its IP portfolio.
All Other category primarily includes certain expenses and credits
that are not allocated to any of the operating segments, such as
amortization of acquisition-related intangibles, employee stock-based
compensation expense, and acquisition-related and other costs.
11
(2) Reconciliation of GAAP Net Income to Adjusted EBITDA
Th… Ni…
Mo… Mo…
En… En…
Se… Ju… Se… Se… Se…
(… 26, 27, 27, 26, 27,
(… 20… 20… 20… 20… 20…
──────────────────────────────────────────────────────────────────────────────
G…
n… $ 2,… $ 2,2… $ 1,2… $ 6,1… $ 2,8…
i…
I… 62 37 37 136 95
e…
O…
(… 902 -598 -82 139 -219
e…
n…
I…
t… -5… 252 153 -65 -558
p…
(…
E…
i… -5 -6 -10 -17 -25
in
i…
S… 523 503 419 1,5… 1,1…
c…
D…
a… 239 221 192 666 556
a…
A…
of 534 544 562 1,6… 1,6…
a…
i…
A…
a… 27 40 42 93 178
o…
c…
R…
of
i…
l… — — -67 — -67
at
c…
m…
L…
c…
on 7 17 12 24 12
l…
m…
L…
(…
f…
d… — 8 -71 -3 -175
o…
n…
of
t…
A… $ 4,… $ 3,3… $ 2,4… $ 10,… $ 5,4…
E…
The Company presents “Adjusted EBITDA” as a
supplemental measure of its performance. Adjusted
EBITDA for the Company is determined by adjusting
GAAP net income for interest expense, other
(income) expense, net, income tax provision
(benefit), equity income in investee, stock-based
compensation, depreciation and amortization
expense, amortization of acquisition-related
intangibles, acquisition-related and other costs,
recovery of inventory loss at contract
manufacturer, loss contingency on legal matters,
and loss (income) from discontinued operations,
net of tax. The Company calculates and presents
Adjusted EBITDA because management believes it is
of importance to investors and lenders in relation
to its overall capital structure and its ability
to borrow additional funds. In addition, the
Company presents Adjusted EBITDA because it
believes this measure assists investors in
comparing its performance across reporting periods
on a consistent basis by excluding items that the
Company does not believe are indicative of its
core operating performance. The Company’s
calculation of Adjusted EBITDA may or may not be
consistent with the calculation of this measure by
other companies in the same industry. Investors
should not view Adjusted EBITDA as an alternative
to the GAAP operating measure of net income or
GAAP liquidity measures of cash flows from
operating, investing and financing activities. In
addition, Adjusted EBITDA does not take into
account changes in certain assets and liabilities
that can affect cash flows.
(3) Reconciliation of GAAP Net Cash Provided by Operating Activities of
Continuing Operations to Free Cash Flow
(M…
ex… Th… Se… Ju… Sep… Ni… Sep… Se…
pe… Mo… 26, 27, 27, Mo… 26, 27,
(U… En… 20… 20… 2025 En… 2026 20…
──────────────────────────────────────────────────────────────────────────────
G…
n…
c…
p…
by $ 1,… $ 2,… $ 1,7… $ 6,5… $ 4,…
o…
a…
of
c…
o…
O…
c…
f…
m… 9 % 21 % 19 % 19 % 17 %
%
f…
c…
o…
P…
of
p… -6… -8… -258 -1,… -7…
a…
e…
F…
c… $ 554 $ 1,… $ 1,5… $ 4,6… $ 3,…
f…
F…
c…
f… 4 % 14 % 17 % 13 % 14 %
m…
%
The Company also presents free cash flow as a
supplemental Non-GAAP measure of its performance.
Free cash flow is determined by adjusting GAAP net
cash provided by operating activities of
continuing operations for capital expenditures,
and free cash flow margin % is free cash flow
expressed as a percentage of the Company's net
revenue. The Company calculates and communicates
free cash flow in the financial earnings press
release because management believes it is of
importance to investors to understand the nature
of these cash flows. The Company’s calculation of
free cash flow may or may not be consistent with
the calculation of this measure by other companies
in the same industry. Investors should not view
free cash flow as an alternative to GAAP liquidity
measures of cash flows from operating activities.
12