Advanced Micro Devices 10-Q 2025-06-28

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 28, 2025

OR

☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-07882

ADVANCED MICRO DEVICES, INC.

(Exact name of registrant as specified in its charter)

Delaware									94-1692300
(State or other jurisdiction of incorporation or organization)									(I.R.S. Employer Identification No.)

2485 Augustine Drive

Santa Clara, California 95054

(Address of principal executive offices)(Zip Code)

(408) 749-4000

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Common Stock, $0.01 par value per share			AMD			The Nasdaq Global Select Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 (the Exchange Act) during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer						☑						Accelerated filer						☐			Non-accelerated filer						☐
Smaller reporting company						☐						Emerging growth company						☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

Indicate the number of shares outstanding of the registrant’s common stock, $0.01 par value per share, as of July 30, 2025: 1,622,843,689

INDEX

						Page No.
Part I Financial Information
Item 1			Condensed Consolidated Financial Statements (Unaudited)
			Condensed Consolidated Statements of Operations			3
			Condensed Consolidated Statements of Comprehensive Income			4
			Condensed Consolidated Balance Sheets			5
			Condensed Consolidated Statements of Cash Flows			6
			Condensed Consolidated Statements of Stockholders’ Equity			8
			Notes to Condensed Consolidated Financial Statements			9
Item 2			Management’s Discussion and Analysis of Financial Condition and Results of Operations			24
Item 3			Quantitative and Qualitative Disclosures about Market Risk			32
Item 4			Controls and Procedures			32
Part II Other Information
Item 1			Legal Proceedings			34
Item 1A			Risk Factors			34
Item 2			Unregistered Sales of Equity Securities and Use of Proceeds			60
Item 5			Other Information			60
Item 6			Exhibits			61
Signature						62

PART I. FINANCIAL INFORMATION

Advanced Micro Devices, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

			Three Months Ended												Six Months Ended
			June 28, 2025						June 29, 2024						June 28, 2025						June 29, 2024
			(In millions, except per share amounts)
Net revenue			$	7,685					$	5,835					$	15,123					$	11,308
Cost of sales			4,366						2,740						7,817						5,423
Amortization of acquisition-related intangibles			260						231						511						461
Total cost of sales			4,626						2,971						8,328						5,884
Gross profit			3,059						2,864						6,795						5,424
Research and development			1,894						1,583						3,622						3,108
Marketing, general and administrative			991						640						1,877						1,247
Amortization of acquisition-related intangibles			308						372						624						764
Total operating expenses			3,193						2,595						6,123						5,119
Operating income (loss)			(134)						269						672						305
Interest expense			(38)						(25)						(58)						(50)
Other income (expense), net			98						55						137						108
Income (loss) from continuing operations before income taxes and equity income			(74)						299						751						363
Income tax provision (benefit)			(834)						41						(711)						(11)
Equity income in investee			8						7						15						14
Income from continuing operations, net of tax			768						265						1,477						388
Income from discontinued operations, net of tax			104						—						104						—
Net income			$	872					$	265					$	1,581					$	388
Earnings per share
Earnings from continuing operations - basic			$	0.47					$	0.16					$	0.91					$	0.24
Earnings from discontinued operations - basic			0.07						—						0.07						—
Basic earnings per share			$	0.54					$	0.16					$	0.98					$	0.24
Earnings from continuing operations - diluted			$	0.47					$	0.16					$	0.91					$	0.24
Earnings from discontinued operations - diluted			0.07						—						0.06						—
Diluted earnings per share			$	0.54					$	0.16					$	0.97					$	0.24
Shares used in per share calculation
Basic			1,623						1,618						1,621						1,617
Diluted			1,630						1,637						1,628						1,638

See accompanying notes.

Advanced Micro Devices, Inc.

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)

			Three Months Ended												Six Months Ended
			June 28, 2025						June 29, 2024						June 28, 2025						June 29, 2024
			(In millions)
Net income			$	872					$	265					$	1,581					$	388
Other comprehensive income, net of tax:
Net change in unrealized gains (losses) on cash flow hedges			50						(1)						79						(19)
Total comprehensive income			$	922					$	264					$	1,660					$	369

See accompanying notes.

Advanced Micro Devices, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

			June 28, 2025						December 28, 2024
			(In millions, except par value amounts)
ASSETS
Current assets:
Cash and cash equivalents			$	4,442					$	3,787
Short-term investments			1,425						1,345
Accounts receivable, net			5,115						6,192
Inventories			6,677						5,734
Assets held for sale			4,326						—
Prepaid expenses and other current assets			2,534						1,991
Total current assets			24,519						19,049
Property and equipment, net			2,128						1,802
Goodwill			25,083						24,839
Acquisition-related intangibles, net			17,812						18,930
Deferred tax assets			860						688
Other non-current assets			4,418						3,918
Total assets			$	74,820					$	69,226
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable			$	3,080					$	2,466
Accrued liabilities			4,479						4,260
Liabilities held for sale			1,968						—
Other current liabilities			316						555
Total current liabilities			9,843						7,281
Long-term debt, net			3,218						1,721
Long-term operating lease liabilities			668						491
Deferred tax liabilities			341						349
Other long-term liabilities			1,085						1,816
Commitments and contingencies (See Note 13)
Stockholders’ equity:
Capital stock:

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The statements in this report include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations and beliefs and involve numerous risks and uncertainties that could cause actual results to differ materially from expectations. These forward-looking statements speak only as of the date hereof or as of the dates indicated in the statements and should not be relied upon as predictions of future events, as we cannot assure you that the events or circumstances reflected in these statements will be achieved or will occur. You can identify forward-looking statements by the use of forward-looking terminology including “believes,” “expects,” “may,” “will,” “should,” “seeks,” “intends,” “plans,” “pro forma,” “estimates,” “anticipates,” or the negative of these words and phrases, other variations of these words and phrases or comparable terminology. The forward-looking statements relate to, among other things: possible impact of future accounting rules on AMD’s condensed consolidated financial statements; demand for AMD’s products; AMD’s strategy and expected benefits; the growth, change and competitive landscape of the markets in which AMD participates; the expectation that international sales will continue to be a significant portion of total sales in the foreseeable future; the expectation that AMD’s cash, cash equivalents, short-term investments and cash flows from operations along with our revolving credit facility and our commercial paper program will be sufficient to fund AMD’s operations, capital expenditures, purchase commitments and strategic activities over the next 12 months and beyond; AMD’s ability to access capital markets; AMD’s expectation that based on management’s current knowledge, the potential liability related to AMD’s current litigation will not have a material adverse effect on its financial positions, results of operation or cash flows; anticipated ongoing and increased costs related to enhancing and implementing information security controls; the expectation that revenue allocated to remaining performance obligations that are unsatisfied will be recognized in the next 12 months; that a small number of customers will continue to account for a substantial part of AMD’s revenue in the future; the expected implications from the development of the legal and regulatory environment relating to emerging technologies, such as AI; AMD’s ability to achieve its corporate responsibility initiatives; compliance costs associated with new or developing sustainability laws and requirements; expected future AI trends and developments; the expected benefits of AMD’s acquisition of ZT Group Int’l, Inc. (ZT Systems); AMD’s pending sale of ZT Systems’ manufacturing business; the extent of impact of export restrictions imposed on by the U.S. on our business; and AMD’s expectation to fund stock repurchases through cash generated from operations. For a discussion of the factors that could cause actual results to differ materially from the forward-looking statements, see “Part II, Item 1A—Risk Factors” and the “Financial Condition” section set forth in “Part I, Item 2-Management’s Discussion and Analysis of Financial Condition and Results of Operations,” or MD&A, and such other risks and uncertainties as set forth below in this report or detailed in our other Securities and Exchange Commission (SEC) reports and filings. We assume no obligation to update forward-looking statements.

References in this Quarterly Report on Form 10-Q to “AMD,” “we,” “us,” “management,” “our” or the “Company” mean Advanced Micro Devices, Inc. and our consolidated subsidiaries.

AMD, the AMD Arrow logo, AMD Instinct, EPYC, Radeon, Ryzen, Xilinx and combinations thereof are trademarks of Advanced Micro Devices, Inc. Other names are for informational purposes only and are used to identify companies and products and may be trademarks of their respective owners. “Zen” is a codename for an AMD architecture and is not a product name.

The following discussion should be read in conjunction with the unaudited condensed consolidated financial statements and related notes included in this report and our audited consolidated financial statements and related notes as of December 28, 2024 and December 30, 2023, and for each of the three years for the period ended December 28, 2024 as filed in our Annual Report on Form 10-K for the fiscal year ended December 28, 2024.

Overview and Recent Developments

We are a global semiconductor company primarily offering:

• Artificial Intelligence (AI) accelerators, microprocessors (CPUs) for server, graphics processing units (GPUs), accelerated processing units (APUs), data processing units (DPUs), Field Programmable Gate Arrays (FPGAs), Smart Network Interface Cards (SmartNICs) and Adaptive System-on-Chip (SoC) products for data centers;

• CPUs, APUs, chipsets for desktops and notebooks, discrete GPUs, semi-custom SoC products and development services; and

• embedded CPUs, GPUs, APUs, FPGAs, System on Modules (SOMs), and Adaptive SoC products.

From time to time, we may also sell or license portions of our intellectual property (IP) portfolio.

In this section, we will describe the general financial condition and the results of operations of Advanced Micro Devices, Inc. and its wholly-owned subsidiaries (collectively, “we”, “us,” “our”, “AMD” or the “Company”), including a discussion of our results of operations for the three and six months ended June 28, 2025 compared to the prior year period and an analysis of changes in our financial condition.

Beginning with the fiscal year ending December 27, 2025, we combined the Client and Gaming segments into one reportable segment to align with how we manage our business. Net revenue for the three months ended June 28, 2025 was $7.7 billion, a 32% increase compared to the prior year period. The increase in net revenue was driven by an increase in Client and Gaming segment revenue primarily driven by strong demand for the latest “Zen 5” AMD Ryzen™ processors and higher semi-custom sales, and an increase in Data Center segment revenue primarily driven by growth in AMD EPYC™ CPU sales. Embedded segment revenue decreased as end market demand remained mixed.

Gross margin for the three months ended June 28, 2025 was 40% compared to gross margin of 49% for the prior year period. The decrease in gross margin was primarily due to approximately $800 million of inventory and related charges associated with the U.S. government export control on AMD Instinct™ MI308 Data Center GPU products.

Operating loss for the three months ended June 28, 2025 was $134 million compared to operating income of $269 million for the prior year period. The decrease in operating income was due to lower gross margin and higher operating expenses. Net income for the three months ended June 28, 2025 was $872 million compared to net income of $265 million for the prior year period. The increase in net income was primarily driven by the income tax benefit resulting from an $853 million release of uncertain tax positions pertaining to the reasonable cause relief for dual consolidated losses received from the Internal Revenue Services (IRS).

As of June 28, 2025, our cash, cash equivalents and short-term investments were $5.9 billion compared to $5.1 billion as of December 28, 2024. During the six months ended June 28, 2025, we generated $3.0 billion of cash from operating activities and we returned $1.2 billion to stockholders through the repurchase of common stock under our Repurchase Program.

On March 31, 2025 (the Acquisition Date), we completed the acquisition of ZT Group Int’l, Inc. (ZT Systems), which is expected to enable AMD to deliver end-to-end AI solutions and accelerate the design and deployment of AMD-powered AI infrastructure at scale optimized for the cloud. At the close of the acquisition, we paid $3.2 billion in cash and issued 8,335,849 shares of our common stock. To the extent contingencies are fully met, we will pay an additional $300 million in cash and issue up to 740,961 shares of our common stock.

At the time of the announcement of the ZT Systems acquisition in August 2024, we disclosed our intent to divest ZT Systems’ data center infrastructure manufacturing business (the ZT Manufacturing Business), while retaining only certain intellectual property and employees (the ZT Design Business). Accordingly, upon acquisition, we classified the ZT Manufacturing Business and its related assets and liabilities as held for sale. The results of the ZT Design Business and the ZT Manufacturing Business are presented within continuing operations and discontinued operations of AMD’s consolidated statements of operations and cash flows, respectively. The consolidated statements of operations include immaterial revenue attributable to the ZT Design Business, which is reported within the Data Center segment from the Acquisition Date.

On May 18, 2025, we entered into an equity purchase agreement (the Sale Agreement) with Sanmina Corporation to sell the ZT Manufacturing Business for $3.0 billion in cash and stock, inclusive of a contingent payment of up to $450 million, subject to customary adjustments for working capital and other items. The Sale Agreement provides that if the sale is not completed by May 18, 2026, subject to two automatic extensions until November 18, 2026, we will be entitled to receive a termination fee of up to $153 million. The transaction is expected to close near the end of 2025, subject to regulatory approvals and customary closing conditions.

We intend the discussion of our financial condition and results of operations that follows to provide information that will assist in understanding our financial statements, the changes in certain key items in those financial statements from period to period, the primary factors that resulted in those changes, and how certain accounting principles, policies and estimates affect our financial statements.

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP). The preparation of our financial statements requires us to make estimates and judgments that affect the reported amounts in our consolidated financial statements. We evaluate our estimates on an ongoing basis, including those related to our revenue, inventories, goodwill, long-lived and intangible assets, business combination accounting and income taxes. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Although actual results have historically been reasonably consistent with management’s expectations, the actual results may differ from these estimates or our estimates may be affected by different assumptions or conditions.

Other than the estimates used in accounting for business combinations, management believes there have been no significant changes for the three and six months ended June 28, 2025 to the items that we disclosed as our critical accounting estimates in the Management’s Discussion and Analysis of Financial Condition and Results of Operations section of our Annual Report on Form 10-K for the fiscal year ended December 28, 2024.

Business Combinations. We allocate the fair value of purchase consideration to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. Such valuations require management to make significant estimates and assumptions, especially with respect to assets and liabilities held for sale, intangible assets and contingent consideration. Significant estimates and inputs used in valuing acquired assets and liabilities held for sale, developed technology, and other identifiable intangible assets include, but are not limited to, expected future revenue, future changes in technology, useful lives, and risk-adjusted discount rates. Management's estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. Allocation of purchase consideration to identifiable assets and liabilities affects our amortization expense, as acquired finite-lived intangible assets are amortized over their useful life, whereas any indefinite-lived intangible assets, including goodwill, are not amortized.

Results of Continuing Operations

Beginning with the fiscal year ending December 27, 2025, we combined the Client and Gaming segments into one reportable segment to align with how we manage our business. Neither of the Client and Gaming businesses qualify as a separate reportable operating segment, however, we continue to separately disclose revenues for each business. All prior period segment data were retrospectively adjusted.

Our operating results tend to vary seasonally. Historically, our net revenue has been generally higher in the second half of the year than in the first half of the year, although market conditions and product transitions could impact this trend.

The following table provides a summary of net revenue and operating income (loss) by segment:

			Three Months Ended												Six Months Ended
			June 28, 2025						June 29, 2024						June 28, 2025						June 29, 2024
			(In millions)
Net revenue:
Data Center			$	3,240					$	2,834					$	6,914					$	5,171
Client and Gaming
Client			$	2,499					$	1,492					$	4,793					$	2,860
Gaming			1,122						648						1,769						1,570
Total Client and Gaming			3,621						2,140						6,562						4,430
Embedded			824						861						1,647						1,707
Total net revenue			$	7,685					$	5,835					$	15,123					$	11,308
Cost of sales and operating expenses:
Data Center			$	3,395					$	2,091					$	6,137					$	3,887
Client and Gaming			2,854						1,974						5,299						4,027
Embedded			549						516						1,044						1,020
All other			1,021						985						1,971						2,069
Total cost of sales and operating expenses			$	7,819					$	5,566					$	14,451					$	11,003
Operating income (loss):
Data Center			$	(155)					$	743					$	777					$	1,284
Client and Gaming			767						166						1,263						403
Embedded			275						345						603						687
All other			(1,021)						(985)						(1,971)						(2,069)
Total operating income (loss)			$	(134)					$	269					$	672					$	305

Data Center

Data Center net revenue of $3.2 billion for the three months ended June 28, 2025 increased by 14%, compared to net revenue of $2.8 billion for the prior year period. Data Center net revenue of $6.9 billion for the six months ended June 28, 2025 increased by 34%, compared to net revenue of $5.2 billion for the prior year period. The increase in both periods was primarily driven by the growth in AMD EPYC™ CPU sales.

Data Center operating loss was $155 million for the three months ended June 28, 2025, compared to operating income of $743 million for the prior year period. Data Center operating income was $777 million for the six months ended June 28, 2025, compared to operating income of $1.3 billion for the prior year period. The decrease in operating income in both periods was primarily due to approximately $800 million of inventory and related charges associated with the U.S. government export control on AMD Instinct MI308 GPU products and higher R&D expense.

Client and Gaming

Client and Gaming net revenue of $3.6 billion for the three months ended June 28, 2025 increased by 69%, compared to net revenue of $2.1 billion for the prior year period. Client and Gaming net revenue of $6.6 billion for the six months ended June 28, 2025 increased by 48%, compared to net revenue of $4.4 billion for the prior year period.

Client revenue for the three months ended June 28, 2025 was $2.5 billion, up 67% from the prior year period, primarily driven by a 42% increase in average selling price, and a 17% increase in unit shipments of AMD Ryzen mobile and desktop processors. Client revenue for the six months ended June 28, 2025 was $4.8 billion, up 68% from the prior year period, primarily driven by a 43% increase in average selling price and 20% increase in unit shipments of AMD Ryzen mobile and desktop processors.

Gaming revenue for the three months ended June 28, 2025 was $1.1 billion, up 73% from the prior year period. Gaming revenue for the six months ended June 28, 2025 was $1.8 billion, up 13% from the prior year period. The increase in both periods was primarily due to an increase in semi-custom and gaming graphics revenue.

Client and Gaming operating income was $767 million for the three months ended June 28, 2025, compared to operating income of $166 million for the prior year period. Client and Gaming operating income was $1.3 billion for the six months ended June 28, 2025, compared to operating income of $403 million for the prior year period. The increase in operating income was primarily driven by higher revenue, partially offset by higher operating expenses.

Embedded

Embedded net revenue of $824 million for the three months ended June 28, 2025 decreased by 4%, compared to net revenue of $861 million for the prior year period. Embedded net revenue of $1.6 billion for the six months ended June 28, 2025 decreased by 4%, compared to net revenue of $1.7 billion for the prior year period. Net revenue decreased in both periods as end market demand remained mixed.

Embedded operating income was $275 million for the three months ended June 28, 2025, compared to operating income of $345 million for the prior year period. Embedded operating income was $603 million for the six months ended June 28, 2025, compared to operating income of $687 million for the prior year period. The decrease in operating income in both periods was primarily due to product mix.

All Other

All Other operating loss of $1.0 billion for the three months ended June 28, 2025 primarily consisted of $568 million of amortization of acquisition-related intangibles and $369 million of stock-based compensation expense. All Other operating loss of $985 million for the three months ended June 29, 2024 primarily consisted of $603 million of amortization of acquisition-related intangibles and $346 million of stock-based compensation expense.

All Other operating loss of $2.0 billion for the six months ended June 28, 2025 primarily consisted of $1.1 billion of amortization of acquisition-related intangibles and $733 million of stock-based compensation expense. All Other operating loss of $2.1 billion for the six months ended June 29, 2024 primarily consisted of $1.2 billion of amortization of acquisition-related intangibles and $717 million of stock-based compensation expense.

International Sales

International sales as a percentage of net revenue were 71% and 60% for the three months ended June 28, 2025 and June 29, 2024, respectively. International sales as a percentage of net revenue were 69% and 60% for the six months ended June 28, 2025 and June 29, 2024, respectively. We expect that international sales will continue to be a significant portion of total sales in the foreseeable future. Substantially all of our sales transactions were denominated in U.S. dollars.

Gross Margin and Expenses

The following is a summary of certain consolidated statement of operations data for the periods indicated:

			Three Months Ended												Six Months Ended
			June 28, 2025						June 29, 2024						June 28, 2025						June 29, 2024
			In millions, except percentages
Net revenue			$	7,685					$	5,835					$	15,123					$	11,308
Cost of sales			4,366						2,740						7,817						5,423
Amortization of acquisition-related intangibles			260						231						511						461
Gross profit			3,059						2,864						6,795						5,424
Gross margin			40			%			49			%			45			%			48			%
Research and development			1,894						1,583						3,622						3,108
Marketing, general and administrative			991						640						1,877						1,247
Amortization of acquisition-related intangibles			308						372						624						764
Interest expense			(38)						(25)						(58)						(50)
Other income (expense), net			98						55						137						108
Income tax provision (benefit)			(834)						41						(711)						(11)
Income from discontinued operations, net of tax			104						—						104						—

Gross Margin

Gross margin was 40% and 49% for the three months ended June 28, 2025 and June 29, 2024, respectively. Gross margin was 45% and 48% for the six months ended June 28, 2025 and June 29, 2024, respectively. The decrease in gross margin in both periods was primarily due to approximately $800 million of inventory and related charges associated with the U.S. government export control on AMD Instinct MI308 Data Center GPU products.

Expenses

Research and Development Expenses

Research and development expenses of $1.9 billion for the three months ended June 28, 2025 increased by $311 million, or 20%, compared to $1.6 billion for the prior year period. Research and development expenses of $3.6 billion for the six months ended June 28, 2025 increased by $514 million, or 17%, compared to $3.1 billion for the prior year period. The increase in both periods was primarily due to higher employee-related costs from an increase in headcount from acquisitions, in support of our continued focus on our AI strategy.

Marketing, General and Administrative Expenses

Marketing, general and administrative expenses of $991 million for the three months ended June 28, 2025 increased by $351 million, or 55%, compared to $640 million for the prior year period. Marketing, general and administrative expenses of $1.9 billion for the six months ended June 28, 2025 increased by $630 million, or 51%, compared to $1.2 billion for the prior year period. The increase in both periods was primarily due to an increase in go-to-market activities in our Client and Gaming segment.

Amortization of Acquisition-Related Intangibles

Amortization of acquisition-related intangibles of $568 million for the three months ended June 28, 2025 decreased by $35 million, or 6%, compared to $603 million for the prior year period. Amortization of acquisition-related intangibles of $1.1 billion for the six months ended June 28, 2025 decreased by $90 million, or 7%, compared to $1.2 billion for the prior year period. The decrease in both periods was primarily due to certain acquisition-related intangibles that were fully amortized in the prior fiscal year, partially offset by amortization of intangible assets from current fiscal quarter acquisitions.

Interest Expense

Interest expense for the three and six months ended June 28, 2025 was $38 million and $58 million, respectively. Interest expense for the three and six months ended June 29, 2024 was $25 million and $50 million, respectively.

The increase in both periods was due to the issuance of $1.5 billion in aggregate principal amount of 4.212% Notes and 4.319% Notes on March 24, 2025.

Other Income (Expense), Net

Other income (expense), net primarily consists of interest income from short-term investments, changes in valuation of equity investments, and foreign currency transaction gains and losses.

Other income (expense), net for three and six months ended June 28, 2025 was $98 million and $137 million, respectively. Other income (expense), net for the three and six months ended June 29, 2024 was $55 million and $108 million, respectively. The increase was primarily due to unrealized gains and dividends received from investments in nonmarketable securities of privately held companies.

Income Taxes

We determine income taxes for interim reporting periods by applying our estimated annual effective tax rate to the year-to-date results and adjusted for tax items discrete to each period.

For the three and six months ended June 28, 2025, we recorded an income tax benefit of $834 million and $711 million representing an effective tax rate from continuing operations of 1,263.6% and (93)%, respectively. The tax benefit for the three and six months ended June 28, 2025 reflected a discrete tax benefit of $792 million and $781 million, respectively, primarily due to a tax benefit of $853 million related to the release of reserves for uncertain tax positions pertaining to the reasonable cause relief for dual consolidated losses approved by the IRS in April 2025, partially offset by other items, including $45 million of deferred tax expense associated with the expected gain on the transfer of appreciated assets related to the ZT Systems acquisition.

For the three and six months ended June 29, 2024, we recorded an income tax provision of $41 million and an income tax benefit of $11 million representing an effective tax rate from continuing operations of 13.4% and (2.9)%, respectively. The tax provision for the three months ended June 29, 2024 reflected a discrete tax expense of $21 million, primarily related to interest and penalties accrued for uncertain tax positions partially offset by the tax effects of stock-based compensation. The tax benefit for the six months ended June 29, 2024 reflected a discrete tax benefit of $40 million, primarily related to stock-based compensation.

On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was enacted into law. The new law extended key provisions of the 2017 Tax Cuts and Jobs Act including, but not limited to, federal bonus depreciation and immediate expensing for domestic research and development expenditures. We are currently assessing the impact of OBBBA on our consolidated financial statements.

Results of Discontinued Operations

Net income from discontinued operations of $104 million includes the results of operations of the ZT Manufacturing Business, partially offset by a $35 million fair value increase in the contingent consideration liability related to the acquisition of ZT Systems and net of an income tax benefit of $24 million.

FINANCIAL CONDITION

Liquidity and Capital Resources

As of June 28, 2025 and December 28, 2024, our cash, cash equivalents and short-term investments were $5.9 billion and $5.1 billion, respectively.

Our operating, investing and financing activities for the six months ended June 28, 2025 compared to the prior year period are as described below:

			Six Months Ended
			June 28, 2025						June 29, 2024
			(In millions)
Net cash provided by (used in):
Net cash provided by operating activities of continuing operations			$	2,401					$	1,114
Net cash provided by operating activities of discontinued operations			549						—
Operating activities			2,950						1,114
Net cash (used in) provided by investing activities of continuing operations			(2,633)						251
Net cash (used in) investing activities of discontinued operations			(22)						—
Investing activities			(2,655)						251
Financing activities of continuing operations			347						(1,185)
Net increase in cash, cash equivalents and restricted cash			$	642					$	180

On March 31, 2025, we completed the acquisition of ZT Systems. At the close of the acquisition, we paid $3.2 billion in cash and issued 8,335,849 shares of our common stock. To the extent contingencies are fully met, we will pay an additional $300 million in cash and issue up to 740,961 shares of our common stock.

On May 18, 2025, we entered into an equity purchase agreement with Sanmina Corporation to sell the ZT Manufacturing Business for $3.0 billion in cash and stock, inclusive of a contingent payment of up to $450 million, subject to customary adjustments for working capital and other items. The transaction is expected to close near the end of 2025, subject to regulatory approvals and customary closing conditions.

As of June 28, 2025, our principal long-term debt obligations were $3.3 billion.

We may issue unsecured commercial paper up to a maximum principal amount outstanding, at any time, of $3.0 billion, with a maturity of up to 397 days from the date of issue. During the three months ended March 29, 2025, we issued $950 million in aggregate principal amount of commercial paper which was subsequently repaid before June 28, 2025. As of June 28, 2025, we had no commercial paper outstanding.

We have $3.0 billion available under an unsecured revolving credit facility that expires on April 29, 2027. No funds were drawn from this credit facility during the three months ended June 28, 2025.

As of June 28, 2025, we had unconditional purchase commitments of approximately $9.4 billion, of which $5.5 billion are for the remainder of fiscal year 2025. We work continually with our suppliers and partners on the timing of payments and deliveries of purchase commitments, taking into account business conditions.

We believe our cash, cash equivalents, short-term investments and cash flows from operations along with our revolving credit facility and commercial paper program will be sufficient to fund operations, capital expenditures, purchase commitments and strategic activities over the next 12 months and beyond. We believe we will be able to access the capital markets should we require additional funds. However, we cannot assure that such funds will be available on favorable terms, or at all.

Operating Activities

Our working capital cash inflows and outflows from operations are primarily cash collections from our customers, payments for inventory purchases and payments for employee-related expenditures.

Net cash provided by operating activities of continuing operations was $2.4 billion in the six months ended June 28, 2025, primarily due to our net income of $1.6 billion, adjusted for non-cash and non-operating charges of $1.2 billion and net cash outflows of $284 million from changes in our operating assets and liabilities. The primary drivers of the change in operating assets and liabilities were a $1.1 billion decrease in accounts receivable due to higher receipts of customer payments and a $943 million increase in inventory primarily to support the continued ramp of Client and Data Center products in advanced process technology nodes. Net cash provided by operating activities of the ZT Manufacturing Business, classified as discontinued operations, was $549 million.

Net cash provided by operating activities of continuing operations was $1.1 billion in the six months ended June 29, 2024, primarily due to our net income of $388 million, adjusted for non-cash and non-operating charges of $2.1 billion and net cash outflows of $1.4 billion from changes in our operating assets and liabilities. The primary drivers of the change in operating assets and liabilities was a $710 million increase in inventory primarily to support the continued ramp of Data Center and Client products in advanced process nodes, and a $373 million increase in accounts receivable due to timing of customer payments. There was no net cash provided by operating activities of discontinued operations for the six months ended June 29, 2024.

Investing Activities

Net cash used in investing activities of continuing operations was $2.6 billion for the six months ended June 28, 2025, which primarily consisted of cash used in acquisitions of $1.7 billion, the purchases of short-term investments of $796 million, purchases of strategic investments of $358 million, and purchases of property and equipment of $494 million, partially offset by $731 million of proceeds from the maturity and sale of short-term investments. Net cash used in investing activities of the ZT Manufacturing Business, classified as discontinued operations, was $22 million due to purchases of equipment.

Net cash provided by investing activities of continuing operations was $251 million for the six months ended June 29, 2024 which primarily consisted of $1.2 billion of proceeds from the maturity and sale of short-term investments, partially offset by cash used in the purchases of short-term investments of $565 million and purchases of property and equipment of $296 million. There was no net cash provided by investing activities of discontinued operations for the six months ended June 29, 2024.

Financing Activities

Net cash provided by financing activities of continuing operations was $347 million for the six months ended June 28, 2025, which primarily consisted of cash received from the issuance of senior notes of $1.5 billion and $950 million of commercial paper, partially offset by stock repurchases of $1.2 billion. There was no net cash provided by financing activities of discontinued operations for the six months ended June 28, 2025.

Net cash used in financing activities was $1.2 billion for the six months ended June 29, 2024, which primarily consisted of repayment of the 2.95% Notes of $750 million, common stock repurchase of $356 million, and repurchases for tax withholding on employee equity plans of $226 million. There was no net cash provided by financing activities of discontinued operations for the six months ended June 29, 2024.

Reference is made to “Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk,” in our Annual Report on Form 10-K for the fiscal year ended December 28, 2024.

There have not been any material changes in interest rate risk, default risk or foreign exchange risk since December 28, 2024.

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports made under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer (CEO) and Chief Financial Officer (CFO) as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As of June 28, 2025, the end of the period covered by this report, we carried out an evaluation under the supervision and with the participation of our management, including our CEO and CFO, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our CEO and CFO concluded that our disclosure controls and procedures were effective at the reasonable assurance level.

There were no changes in our internal controls over financial reporting for the three months ended June 28, 2025 that materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

PART II. OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

For a discussion of our legal proceedings, refer to Note 13—Commitments and Contingencies of the Notes to Condensed Consolidated Financial Statements (Part I, Item 1 of this Form 10-Q).

The risks and uncertainties described below are not the only ones we face. If any of the following risks actually occurs, our business, financial condition or results of operations could be materially adversely affected. In addition, you should consider the interrelationship and compounding effects of two or more risks occurring simultaneously.

Risk Factors Summary

The following is a summary of the principal risks that could adversely affect our business, financial condition and results of operations.

Economic and Strategic Risks

• The markets in which our products are sold are highly competitive and rapidly evolving.

• The semiconductor industry is highly cyclical and has experienced severe downturns.

• The demand for our products depends in part on the market conditions in the industries into which they are sold.

• The success of our business depends on our ability to introduce products on a timely basis with features and performance levels that provide value to our customers while supporting significant industry transitions.

• The loss of a significant customer may have a material adverse effect on us.

• Economic and market uncertainty may adversely impact our business and operating results.

• Our operating results are subject to quarterly and seasonal sales patterns.

• If we cannot adequately protect our technology or other intellectual property through patents, copyrights, trade secrets, trademarks and other measures, we may lose a competitive advantage and incur significant expenses.

• Unfavorable currency exchange rate fluctuations could adversely affect us.

Operational and Technology Risks

• We rely on third parties to manufacture our products, and if they are unable to do so on a timely basis in sufficient quantities and using competitive technologies, our business could be materially adversely affected.

• Essential equipment, materials, substrates or manufacturing processes may not be available to us.

• We may fail to achieve expected manufacturing yields for our products.

• Our revenue from our semi-custom System-on-Chip (SoC) products is dependent upon our semi-custom SoC products being incorporated into customers’ products and the success of those products.

• Our products may be subject to security vulnerabilities that could have a material adverse effect on us.

• IT outages, data loss, data breaches and cyberattacks could disrupt operations and compromise our intellectual property or other sensitive information, be costly to remediate or cause significant damage to our business, reputation, financial condition and results of operations.

• Uncertainties involving the ordering and shipment of our products could materially adversely affect us.

• Our ability to design and introduce new products includes the use of third-party intellectual property.

• We depend on third-party companies for the design, manufacture and supply of motherboards, software, memory and other computer platform components to support our business and products.

• If we lose Microsoft Corporation’s support for our products or other software vendors do not design and develop software to run on our products, our ability to sell our products could be materially adversely affected.

• Our reliance on third-party distributors and add-in-board (AIB) partners subjects us to certain risks.

• Our business depends on the proper functioning of our internal business processes and information systems.

• Our products may not be compatible with some or all industry-standard software and hardware.

• Costs related to defective products could have a material adverse effect on us.

• We may fail to maintain the efficiency of our supply chain as we respond to changes in customer demand.

• We outsource to third parties certain supply-chain logistics functions.

• We may be unable to effectively control the sales of our products on the gray market.

• Climate change may have an impact on our business.

Legal and Regulatory Risks

• Government actions and regulations, including but not limited to export regulations, tariffs and trade protection measures, may limit our ability to export our products to certain customers.

• If we cannot realize our deferred tax assets, our results of operations could be adversely affected.

• Our business is subject to potential tax liabilities, including as a result of tax regulation changes.

• We are party to litigation and may become a party to other claims or litigation.

• We are subject to environmental laws, conflict minerals regulations, as well as a variety of other laws or regulations.

• Evolving expectations from governments, investors, customers and other stakeholders regarding corporate responsibility matters could result in additional costs, harm to our reputation and a loss of customers.

• Issues related to the responsible use of AI may result in reputational, competitive and financial harm and liability.

• The agreements governing our notes, our guarantee of Xilinx’s notes, Revolving Credit Agreement and the ZT Systems Credit Agreement impose restrictions on us.

Merger, Acquisition, Divestiture, and Integration Risks

• Acquisitions, joint ventures, and/or strategic investments, and the failure to integrate acquired businesses may fail to materialize their anticipated benefits and could disrupt our business.

• Our ability to complete the sale of ZT Systems’ manufacturing business is subject to closing conditions.

• Any impairment of our tangible, definite-lived intangible or indefinite-lived intangible assets, including goodwill, may adversely impact our financial position and results of operations.

General Risks

• Our worldwide operations are subject to political, legal and economic risks and natural disasters.

• We may incur future impairments of our technology license purchases.

• Our inability to continue to attract and retain qualified personnel may hinder our business.

• Our stock price is subject to volatility.

For a more complete discussion of the material risks facing our business, see below.

Economic and Strategic Risks

The markets in which our products are sold are highly competitive and rapidly evolving.

Delivering the latest and best products to market on time is critical to revenue growth. The competitiveness of our products depends on a number of factors including, performance, total cost of ownership, timely product introductions, product quality and reliability, product features and capabilities, energy efficiency (including power consumption and battery life, given their impact on total cost of ownership), size (or form factor), selling price, cost, adherence to industry standards (and the creation of open industry standards), level of integration, software and hardware compatibility, ease of use and functionality of software design tools, completeness of applicable software solutions, security and stability, brand recognition and availability.

Competition is expected to remain intense, driven by rapid technological change, evolving standards, shifting customer preferences, product obsolescence, and frequent product launches from both established and new competitors. Some of our competitors may possess stronger market positions, larger customer bases, more design wins, and greater financial, sales, marketing, and distribution resources than us. As a result, they may be able to acquire market share or limit our ability to do so, more effectively capitalize on new market opportunities, and transition their products more efficiently than we can. Some competitors are pursuing alternative computing architectures, such as Arm, which could grow the Arm ecosystem and increase competition in consumer, commercial and data center, reducing demand for our products. Additionally, we may encounter competition from customers who internally develop products to support similar AI workloads to those supported by ours.   

Our competitors may use their market position

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Rule 10b5-1 Trading Plans

During the quarterly period ended June 28, 2025, the following directors and officers adopted, modified or terminated 10b5-1 plans:

Name			Title of Director or Officer			Action			Date			Trading Arrangement						Total Shares to be Sold						Expiration Date
Rule 10b5-1*			Non-Rule 10b5‑1**
Forrest Norrod			Executive Vice President and General Manager, Data Center Solutions			Adopt			June 6, 2025			X						77,837						June 6, 2026
Ava Hahn			Senior Vice President, General Counsel and Corporate Secretary			Adopt			June 2, 2025			X						8,254			1			June 2, 2026
* Intended to satisfy the affirmative defense of Rule 10b5-1(c) ** Not intended to satisfy the affirmative defense of Rule 10b5-1(c)
1 The total number of shares to be sold cannot be determined as of the date of this Quarterly Report as the planned sale amount for the officer includes a designated percentage of net vested shares. The number listed reflects the maximum number of shares available to be sold pursuant to the officer’s 10b5-1 trading plan.

2.1						Equity Purchase Agreement dated as of May 18, 2025, by and among Advanced Micro Designs, Inc., AMD Design, LLC, ZT Group Int’l, Inc. and Sanmina Corporation, filed as Exhibit 2.1 to AMD’s Current Report on Form 8-K dated May 18, 2025, is hereby incorporated by reference.
3.1						Amended and Restated Certificate of Incorporation of Advanced Micro Devices, Inc., filed as Exhibit 3.1 to AMD’s Current Report on Form 8-K/A dated May 14, 2025, is hereby incorporated by reference.
3.2						Advanced Micro Devices, Inc. Amended and Restated Bylaws, as amended on February 13, 2024, filed as Exhibit 3.1 to AMD’s Current Report on Form 8-K dated February 20, 2024, is hereby incorporated by reference.
*10.1						Form of Stock Option Award Agreement for Senior Vice Presidents and Above under the 2023 Equity Incentive Plan.
*10.2						Form of Restricted Stock Unit Grant Agreement for Senior Vice Presidents and Above under the 2023 Equity Incentive Plan.
*10.3						Form of Performance-Based Restricted Stock Unit Grant Notice for Senior Vice Presidents and Above under the 2023 Equity Incentive Plan.
31.1						Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2						Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1						Certification of the Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2						Certification of the Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS						XBRL Instance Document.
101.SCH						XBRL Taxonomy Extension Schema Document.
101.CAL						XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF						XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB						XBRL Taxonomy Extension Label Linkbase Document.
101.PRE						XBRL Taxonomy Extension Presentation Linkbase Document.
104						Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document
*Management contracts and compensatory plans or arrangements.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

						ADVANCED MICRO DEVICES, INC.
August 5, 2025						By:			/s/ Jean Hu
						Name:			Jean Hu
						Title:			Executive Vice President, Chief Financial Officer and Treasurer Signing on behalf of the Registrant as the Principal Financial Officer