Item 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Advanced Micro Devices, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

			Three Months Ended												Nine Months Ended
			September 27, 2025						September 28, 2024						September 27, 2025						September 28, 2024
			(In millions, except per share amounts)
Net revenue			$	9,246					$	6,819					$	24,369					$	18,127
Cost of sales			4,206						3,167						12,023						8,590
Amortization of acquisition-related intangibles			260						233						771						694
Total cost of sales			4,466						3,400						12,794						9,284
Gross profit			4,780						3,419						11,575						8,843
Research and development			2,139						1,636						5,761						4,744
Marketing, general and administrative			1,069						707						2,946						1,954
Amortization of acquisition-related intangibles			302						352						926						1,116
Total operating expenses			3,510						2,695						9,633						7,814
Operating income			1,270						724						1,942						1,029
Interest expense			(37)						(23)						(95)						(73)
Other income (expense), net			82						36						219						144
Income from continuing operations before income taxes and equity income			1,315						737						2,066						1,100
Income tax provision (benefit)			153						(27)						(558)						(38)
Equity income in investee			10						7						25						21
Income from continuing operations, net of tax			1,172						771						2,649						1,159
Income from discontinued operations, net of tax			71						—						175						—
Net income			$	1,243					$	771					$	2,824					$	1,159
Earnings per share
Earnings from continuing operations - basic			$	0.72					$	0.48					$	1.63					$	0.72
Earnings from discontinued operations - basic			0.04						—						0.11						—
Basic earnings per share			$	0.76					$	0.48					$	1.74					$	0.72
Earnings from continuing operations - diluted			$	0.71					$	0.47					$	1.62					$	0.71
Earnings from discontinued operations - diluted			0.04						—						0.11						—
Diluted earnings per share			$	0.75					$	0.47					$	1.73					$	0.71
Shares used in per share calculation
Basic			1,626						1,620						1,623						1,619
Diluted			1,641						1,636						1,632						1,638

See accompanying notes.

Advanced Micro Devices, Inc.

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)

			Three Months Ended												Nine Months Ended
			September 27, 2025						September 28, 2024						September 27, 2025						September 28, 2024
			(In millions)
Net income			$	1,243					$	771					$	2,824					$	1159
Other comprehensive income, net of tax:
Net change in unrealized gains (losses) on cash flow hedges			(23)						31						56						12
Total comprehensive income			$	1,220					$	802					$	2,880					$	1,171

See accompanying notes.

Advanced Micro Devices, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

			September 27, 2025						December 28, 2024
			(In millions, except par value amounts)
ASSETS
Current assets:
Cash and cash equivalents			$	4,808					$	3,787
Short-term investments			2,435						1,345
Accounts receivable, net			6,201						6,192
Inventories			7,313						5,734
Assets held for sale			3,990						—
Prepaid expenses and other current assets			2,253						1,991
Total current assets			27,000						19,049
Property and equipment, net			2,205						1,802
Goodwill			25,083						24,839
Acquisition-related intangibles, net			17,250						18,930
Deferred tax assets			633						688
Other non-current assets			4,720						3,918
Total assets			$	76,891					$	69,226
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable			$	3,483					$	2,466
Accrued liabilities			5,112						4,260
Current portion of long-term debt, net			873						—
Liabilities held for sale			1,908						—
Other current liabilities			324						555
Total current liabilities			11,700						7,281
Long-term debt, net			2,347						1,721
Long-term operating lease liabilities			650						491
Deferred tax liabilities			326						349
Other long-term liabilities			1,078						1,816
Commitments and contingencies (See Note 13)
Stockholders’ equity:
Capital stock:
Common stock, par value $0.01; shares authorized: 4,000; shares issued: 1,693 and 1,680; shares outstanding: 1,628 and 1,622			17						17
Additional paid-in capital			62,657						61,362
Treasury stock, at cost (shares held: 65 and 58)			(7,059)						(6,106)
Retained earnings			5,188						2,364
Accumulated other comprehensive loss			(13)						(69)
Total stockholders’ equity			60,790						57,568
Total liabilities and stockholders’ equity			$	76,891					$	69,226

See accompanying notes.

Advanced Micro Devices, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

			Nine Months Ended
			September 27, 2025						September 28, 2024
			(In millions)
Cash flows from operating activities:
Net income			$	2,824					$	1,159
Income from discontinued operations, net of tax			(175)						—
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			556						499
Amortization of acquisition-related intangibles			1,697						1,810
Stock-based compensation			1,152						1,068
Deferred income taxes			18						(863)
Release of reserves for uncertain tax positions			(853)						—
Inventory loss at (recovery from) contract manufacturer			(67)						65
Other			29						32
Changes in operating assets and liabilities:
Accounts receivable, net			(7)						(1,961)
Inventories			(1,579)						(1,096)
Prepaid expenses and other assets			(259)						(171)
Accounts payable			998						574
Accrued and other liabilities			(145)						626
Net cash provided by operating activities of continuing operations			4,189						1,742
Net cash provided by operating activities of discontinued operations			920						—
Net cash flows provided by operating activities			5,109						1,742
Cash flows from investing activities:
Purchases of property and equipment			(752)						(428)
Purchases of short-term investments			(2,110)						(707)
Proceeds from maturity of short-term investments			982						1,351
Proceeds from sale of short-term investments			66						591
Purchases of strategic investments			(432)						(131)
Acquisitions, net of cash acquired			(1,716)						(548)
Other			—						(15)
Net cash (used in) provided by investing activities of continuing operations			(3,962)						113
Net cash used in investing activities of discontinued operations			(30)						—
Net cash flows (used in) provided by investing activities			(3,992)						113
Cash flows from financing activities:
Proceeds from debt and commercial paper issuance, net of issuance costs			2,441						—
Repayment of debt and commercial paper			(950)						(750)
Proceeds from sales of common stock through employee equity plans			169						152
Repurchases of common stock			(1,316)						(606)
Stock repurchases for tax withholding on employee equity plans			(447)						(686)
Other			—						(1)
Net cash used in financing activities of continuing operations			(103)						(1,891)
Net increase (decrease) in cash, cash equivalents and restricted cash			1,014						(36)
Cash, cash equivalents and restricted cash at beginning of period			3,811						3,933
Cash, cash equivalents and restricted cash at end of period			$	4,825					$	3,897

Advanced Micro Devices, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

			Nine Months Ended
			September 27, 2025						September 28, 2024
			(In millions)
Supplemental cash flow information:
Cash paid during the period for:
Income taxes, net of refunds			$	818					$	1,011
Non-cash investing and financing activities:
Purchases of property and equipment, accrued but not paid			$	153					$	99
Reissuance of treasury stock for the acquisition of ZT Systems			$	860					$	—
Contingent consideration liability for the acquisition of ZT Systems			$	361					$	—
Reconciliation of cash, cash equivalents and restricted cash
Cash and cash equivalents			$	4,808					$	3,897
Restricted cash included in Prepaid expenses and other current assets			17						—
Cash, cash equivalents and restricted cash at end of period			$	4,825					$	3,897

See accompanying notes.

Advanced Micro Devices, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited)

			Three Months Ended												Nine Months Ended
			September 27, 2025						September 28, 2024						September 27, 2025						September 28, 2024
			(In millions)
Capital stock:
Common stock, par value
Balance, beginning of period			$	17					$	17					$	17					$	17
Balance, end of period			$	17					$	17					$	17					$	17
Additional paid-in capital
Balance, beginning of period			$	62,228					$	60,542					$	61,362					$	59,676
Common stock issued under employee equity plans			10						3						170						152
Stock-based compensation			419						351						1,152						1,068
Reissuance of treasury stock			—						—						(27)						—
Balance, end of period			$	62,657					$	60,896					$	62,657					$	60,896
Treasury stock
Balance, beginning of period			$	(6,535)					$	(5,103)					$	(6,106)					$	(4,514)
Repurchases of common stock			(81)						(250)						(1,317)						(606)
Common stock repurchases for tax withholding on employee equity plans			(443)						(459)						(524)						(692)
Reissuance of treasury stock			—						—						888						—
Balance, end of period			$	(7,059)					$	(5,812)					$	(7,059)					$	(5,812)
Retained earnings:
Balance, beginning of period			$	3,945					$	1,111					$	2,364					$	723
Net income			1,243						771						2,824						1,159
Balance, end of period			$	5,188					$	1,882					$	5,188					$	1,882
Accumulated other comprehensive income (loss):
Balance, beginning of period			$	10					$	(29)					$	(69)					$	(10)
Other comprehensive income (loss)			(23)						31						56						12
Balance, end of period			$	(13)					$	2					$	(13)					$	2
Total stockholders' equity			$	60,790					$	56,985					$	60,790					$	56,985

See accompanying notes.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

NOTE 1 – The Company

Advanced Micro Devices, Inc. is a global semiconductor company. References herein to AMD or the Company mean Advanced Micro Devices, Inc. and its consolidated subsidiaries. AMD’s products include Artificial Intelligence (AI) accelerators, microprocessors (CPUs) for servers and graphics processing units (GPUs) as standalone devices or as incorporated into accelerated processing units (APUs), chipsets, data center and professional GPUs, embedded processors, semi-custom System-on-Chip (SoC) products, microprocessor and SoC development services and technology, data processing units (DPUs), Field Programmable Gate Arrays (FPGAs), System on Modules (SOMs), Smart Network Interface Cards (SmartNICs), and Adaptive SoC products. From time to time, the Company may also sell or license portions of its intellectual property (IP) portfolio.

On March 31, 2025, the Company completed the acquisition of ZT Group Int’l, Inc. (ZT Systems). See Note 5 - Acquisitions and Divestitures for additional information.

NOTE 2 – Basis of Presentation and Significant Accounting Policies

Basis of Presentation. The accompanying unaudited condensed consolidated financial statements of AMD have been prepared in accordance with United States generally accepted accounting principles (U.S. GAAP) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. The results of operations for the three and nine months ended September 27, 2025 shown in this report are not necessarily indicative of results to be expected for the full year ending December 27, 2025 or any other future period. In the opinion of the Company’s management, the information contained herein reflects all adjustments necessary for a fair presentation of the Company’s results of operations, financial position, cash flows and stockholders’ equity. All such adjustments are of a normal, recurring nature. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended December 28, 2024. Certain amounts from fiscal year 2024 have been reclassified to conform to current period presentation. These include the presentation of Payables to related parties within Accounts payable, Operating lease right-of-use assets and Investment: equity method within Other non-current assets, and Receivables from related parties within Prepaid expenses and other current assets.

The Company uses a 52- or 53-week fiscal year ending on the last Saturday in December. The three and nine months ended September 27, 2025 and September 28, 2024 each consisted of 13 weeks and 39 weeks, respectively.

Use of Estimates. The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of commitments and contingencies at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results are likely to differ from those estimates, and such differences may be material to the financial statements. Areas where management uses subjective judgment include, but are not limited to: revenue allowances, inventory valuation, valuation of goodwill, long-lived and intangible assets, business combination accounting and income taxes.

Significant Accounting Policies. There have been no material changes to the Company’s significant accounting policies in Note 2 - Basis of Presentation and Significant Accounting Policies, of the Notes to Condensed Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 28, 2024.

NOTE 3 – Supplemental Financial Statement Information

Inventories			September 27, 2025						December 28, 2024
			(In millions)
Raw materials			$	676					$	351
Work in process			4,401						4,289
Finished goods			2,236						1,094
Total inventories			$	7,313					$	5,734

Prepaid Expenses and Other Current Assets			September 27, 2025						December 28, 2024
			(In millions)
Unbilled receivables			$	312					$	628
Other			1,941						1,363
Total prepaid expenses and other current assets			$	2,253					$	1,991

Property and Equipment, net			September 27, 2025						December 28, 2024
			(In millions)
Land, building and leasehold improvements			$	955					$	853
Equipment			3,183						2,798
Construction in progress			590						324
Property and equipment, gross			4,728						3,975
Accumulated depreciation			(2,523)						(2,173)
Total property and equipment, net			$	2,205					$	1,802

Accrued Liabilities			September 27, 2025						December 28, 2024
			(In millions)
Customer-related liabilities			$	1,080					$	1,349
Accrued marketing programs			1,311						1,063
Accrued compensation and benefits			1,425						1,174
Other accrued expenses and liabilities			1,296						674
Total accrued liabilities			$	5,112					$	4,260

Revenue

Revenue allocated to remaining performance obligations that are unsatisfied or partially unsatisfied include amounts received from customers and amounts that will be invoiced and recognized as revenue in future periods for development services, IP licensing and product revenue. As of September 27, 2025, the aggregate transaction price allocated to remaining performance obligations under contracts with an original expected duration of more than one year was $279 million, of which $139 million is expected to be recognized in the next 12 months. The revenue allocated to remaining performance obligations does not include amounts which have an original expected duration of one year or less.

Revenue recognized over time associated with custom products and development services accounted for approximately 9% and 10% of the Company’s revenue for the three and nine months ended September 27, 2025, respectively, and 5% and 10% of the Company’s revenue for the three and nine months ended September 28, 2024, respectively.

Cost of Sales

During the nine months ended September 27, 2025, the Company recorded approximately $800 million of inventory and related charges associated with the U.S. government export control on AMD Instinct™ MI308 Data Center GPU products in Cost of sales.

NOTE 4 – Segment Reporting

Management, including the Chief Operating Decision Maker (CODM), who is the Company’s Chief Executive Officer, reviews and assesses operating performance using segment net revenue, cost of sales and operating expenses, and operating income (loss). These performance measures include the allocation of expenses to the reportable segments based on management’s judgment. The CODM is regularly provided segment operating income to assess relative segment performance.

Beginning with the fiscal year ending December 27, 2025, the Company changed its segment structure, combining the Client and Gaming segments into one reportable segment to align with how the Company manages its business. All prior period segment data were retrospectively adjusted. The Company’s three reportable segments are:

• the Data Center segment, which primarily includes Artificial Intelligence (AI) accelerators, microprocessors (CPUs) for servers, 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;

• the Client and Gaming segment, which primarily includes CPUs, APUs, chipsets for desktops and notebooks, discrete GPUs, and semi-custom SoC products and development services; and

• the Embedded segment, which primarily includes embedded CPUs, GPUs, 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.

In addition to these reportable segments, the Company has an All Other category, which is not a reportable segment. This category primarily includes certain expenses and credits that are not allocated to any of the reportable segments because the CODM does not consider these expenses and credits in evaluating the performance of the reportable segments. This category primarily includes amortization of acquisition-related intangibles, employee stock-based compensation expense, acquisition-related and other costs, inventory loss at (recovery from) contract manufacturer, and restructuring charges. Acquisition-related and other costs primarily include certain compensation charges and transaction costs.

The following table provides a summary of net revenue, cost of sales and operating expenses, and operating income (loss) by segment. Segment cost of sales and operating expenses primarily include materials, external manufacturing, labor and marketing and advertising costs, and exclude expenses and credits that are recorded within the All Other category. Neither of the Client and Gaming businesses qualify as a separate reportable operating segment, however, the Company continues to separately disclose revenue for each business.

			Three Months Ended												Nine Months Ended
			September 27, 2025						September 28, 2024						September 27, 2025						September 28, 2024
			(In millions)
Net revenue:
Data Center			$	4,341					$	3,549					$	11,255					$	8,720
Client and Gaming
Client			2,750						1,881						7,543						4,741
Gaming			1,298						462						3,067						2,032
Total Client and Gaming			4,048						2,343						10,610						6,773
Embedded			857						927						2,504						2,634
Total net revenue			$	9,246					$	6,819					$	24,369					$	18,127
Cost of sales and operating expenses:
Data Center			$	3,267					$	2,508					$	9,404					$	6,395
Client and Gaming			3,181						2,055						8,480						6,082
Embedded			574						555						1,618						1,575
All other			954						977						2,925						3,046
Total cost of sales and operating expenses			$	7,976					$	6,095					$	22,427					$	17,098
Operating income (loss):
Data Center			$	1,074					$	1,041					$	1,851					$	2,325
Client and Gaming			867						288						2,130						691
Embedded			283						372						886						1,059
All other (1)			(954)						(977)						(2,925)						(3,046)
Total operating income			$	1,270					$	724					$	1,942					$	1,029

(1)			For the three and nine months ended September 27, 2025, all other operating losses primarily included $562 million and $1.7 billion of amortization of acquisition-related intangibles, and $419 million and $1.2 billion of stock-based compensation expense, respectively. For the three and nine months ended September 28, 2024, all other operating losses primarily included $585 million and $1.8 billion of amortization of acquisition-related intangibles, and $351 million and $1.1 billion of stock-based compensation expense, respectively.

NOTE 5 – Acquisitions and Divestitures

ZT Systems Acquisition

On March 31, 2025 (the Acquisition Date), the Company completed the acquisition of all issued and outstanding shares of ZT Systems for a total purchase consideration of $4.4 billion. ZT Systems is a provider of AI and general-purpose compute infrastructure for hyperscale computing companies. The acquisition is expected to enable the Company to deliver end-to-end AI solutions and accelerate the design and deployment of AMD-powered AI infrastructure at scale optimized for the cloud.

The purchase consideration is comprised of the following (in millions):

Cash paid on Acquisition Date						$	3,188
Fair value of 8,335,849 shares(1) issued on Acquisition Date						860
Fair value of contingent consideration(2) on Acquisition Date not yet paid						361
Total purchase consideration						$	4,409

(1) Represents the fair value based on the closing price of AMD common stock on March 28, 2025 of $103.22 per share, as the transaction closed prior to the opening of markets on March 31, 2025.

(2) Represents the estimated fair value of 740,961 shares of AMD common stock to be issued and $300 million of cash to be paid to former ZT Systems stockholders and warrant holders assuming the contingencies are fully met.

The purchase consideration was allocated as follows (in millions):

Cash and cash equivalents									$	1,500
Assets held for sale									5,965
Other assets									81
Total assets acquired									7,546
Liabilities held for sale									3,221
Other liabilities									124
Total liabilities assumed									3,345
Fair value of net assets acquired									4,201
Goodwill									208
Total purchase consideration									$	4,409

The Company allocated the purchase price to identifiable tangible and intangible assets acquired and liabilities assumed based on estimates of their fair values, which were determined using generally accepted valuation techniques based on estimates and assumptions made by management. The assets and liabilities related to the ZT Systems’ data center infrastructure manufacturing business (ZT Manufacturing Business) were classified as held for sale due to the Company’s intent to divest it. Fair values of assets and liabilities classified as held for sale were determined using the income and cost valuation approaches, which incorporate significant unobservable inputs. Goodwill arising from the ZT Systems acquisition was assigned to the Company’s Data Center reporting unit. Goodwill was primarily attributed to the assembled workforce and is not expected to be deductible for income tax purposes.

The Company retained select intellectual property and employees associated with the design operations (ZT Design Business). The results of operations of the ZT Design business, which are not material, are included in the Company’s continuing operations within the Data Center segment. The results of operations of the ZT Manufacturing Business are presented as discontinued operations in the Company’s consolidated financial statements.

Transaction costs of $47 million were recorded within Marketing, general and administrative expenses during the nine months ended September 27, 2025 and no transaction costs were incurred in the three months ended September 27, 2025.

The following summarizes carrying amounts of major classes of ZT Manufacturing Business assets and liabilities held for sale as of September 27, 2025 (in millions):

Accounts receivable						$	1,489
Inventories						1,365
Other assets						677
Goodwill and intangible assets						459
Total assets held for sale						$	3,990

Accounts payable						$	1,118
Accrued and other liabilities						790
Total liabilities held for sale						$	1,908

Assets and liabilities held for sale are recorded using the lower of carrying values or fair values less estimated costs to sell.

The following table presents a reconciliation of the contingent consideration liability (in millions:)

Initial valuation of contingent consideration liability												$	361
Change in fair value												52
Contingent consideration liability, September 27, 2025												$	413

Contingent consideration liability was measured at fair value on Acquisition Date and is remeasured to fair value until the contingencies are resolved. The fair value of the contingent consideration liability was estimated based on the present value of the contingent cash and stock consideration using significant unobservable inputs such as risk-adjusted discount rates, equity volatility and simulated stock price. The simulated stock price was calculated using the Monte Carlo simulation method. The fair value of contingent consideration liability may increase or decrease based on changes in these significant inputs. The amount is recorded within Accrued liabilities of the Company’s consolidated balance sheets and the changes in fair value are recognized within Income from discontinued operations of the Company’s consolidated statements of operations.

ZT Manufacturing Business Divestiture

On May 18, 2025, the Company entered into an equity purchase agreement with Sanmina Corporation (Sanmina) 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. See Note 15 - Subsequent Events for additional information.

Other Acquisitions

During the three and nine months ended September 27, 2025, the Company completed other business acquisitions for a total consideration of $36 million that resulted in the recognition of $36 million of goodwill. The financial results of these acquired businesses, which were not material, were included in the Company's consolidated statements of operations from their respective dates of acquisition within the Data Center segment.              

Pro Forma Information

Since the ZT Manufacturing Business represents the majority of ZT Systems’ operations and was held for sale, pro forma information presenting the combined results of operations of ZT Systems and other acquired entities were deemed neither material nor meaningful to the Company’s consolidated income from continuing operations and were omitted.

NOTE 6 – Goodwill and Acquisition-related Intangibles, net

Goodwill

In the first quarter of fiscal year 2025, the Company assigned goodwill to its updated reporting units to reflect the change in its segment reporting structure. The Company performed a goodwill impairment test immediately prior to and after the segment change and determined that no indicators of impairment to goodwill existed.

The following table summarizes Goodwill:

															Before segment change												After segment change
(in millions)			Data Center						Embedded						Client						Gaming						Client and Gaming						Total
December 28, 2024			$	3,403					$	21,072					$	126					$	238					$	—					$	24,839
Reassignment due to segment change			—						—						(126)						(238)						364						—
Acquisitions			244						—						—						—						—						244
September 27, 2025			$	3,647					$	21,072					$	—					$	—					$	364					$	25,083

Acquisition-related Intangibles, net

The following table summarizes Acquisition-related Intangibles Assets:

			September 27, 2025																		December 28, 2024
			Gross Carrying Amount						Accumulated Amortization						Net Carrying Amount						Gross Carrying Amount						Accumulated Amortization						Net Carrying Amount
			(In millions)																		(In millions)
Developed technology			$	13,587					$	(3,300)					$	10,287					$	13,408					$	(2,529)					$	10,879
Customer relationships			12,324						(5,990)						6,334						12,324						(5,124)						7,200
Product trademarks			914						(285)						629						914						(225)						689
Acquisition-related intangible assets subject to amortization			26,825						(9,575)						17,250						26,646						(7,878)						18,768
In-process research and development (IPR&D) not subject to amortization			—						—						—						162						—						162
Total acquisition-related intangible assets, net			$	26,825					$	(9,575)					$	17,250					$	26,808					$	(7,878)					$	18,930

In April 2025, $162 million of IPR&D intangible asset reached technological feasibility, was placed in service as developed technology and started amortization over its estimated useful life of 5 years.

Acquisition-related intangible amortization expense was $562 million and $1.7 billion for the three and nine months ended September 27, 2025, respectively, and $585 million and $1.8 billion for the three and nine months ended September 28, 2024, respectively.

Based on the carrying value of acquisition-related intangibles recorded as of September 27, 2025, and assuming no subsequent impairment of the underlying assets, the estimated annual amortization expense for acquisition-related intangibles is expected to be as follows:

Fiscal Year			(In millions)
Remainder of 2025			$	556
2026			2,149
2027			2,031
2028			1,919
2029			1,691
2030 and thereafter			8,904
Total			$	17,250

NOTE 7 – Related Party — Equity Joint Ventures

ATMP Joint Ventures

The Company holds a 15% equity interest in two joint ventures (collectively, the ATMP JV) with affiliates of Tongfu Microelectronics Co., Ltd, a Chinese joint stock company. The Company has no obligation to fund the ATMP JV. The Company accounts for its equity interests in the ATMP JV under the equity method of accounting due to its significant influence over the ATMP JV. The carrying value of the Company’s investment in ATMP JV was $174 million and $149 million as of September 27, 2025 and December 28, 2024, respectively, and is recorded within Other non-current assets on the Company’s consolidated balance sheets.

The ATMP JV provides assembly, test, mark and packaging (ATMP) services to the Company. The Company’s purchases from the ATMP JV during the three and nine months ended September 27, 2025 were $483 million and $1.5 billion, respectively. The Company’s purchases from the ATMP JV during the three and nine months ended September 28, 2024 were $407 million and $1.2 billion, respectively. As of September 27, 2025 and December 28, 2024, the amounts payable to the ATMP JV were $516 million and $476 million, respectively, and are included in Accounts payable on the Company’s consolidated balance sheets.

On October 9, 2024, the Company entered into a one-year term loan agreement with one of the ATMP JVs for $100 million to provide funds for the ATMP JV’s general corporate purposes. The loan bears interest, payable quarterly, at the three months term Secured Overnight Financing Rate (SOFR) plus 50 basis points. The loan receivable is included within Prepaid expenses and other current assets on the Company’s consolidated balance sheets. On October 9, 2025, the loan agreement was amended to extend the term of the loan until October 16, 2026 with an interest rate, payable quarterly, at the three months term SOFR plus 35 basis points.

During the three and nine months ended September 27, 2025, the Company recorded income related to the ATMP JV of $10 million and $25 million, respectively, in Equity income in investee on its consolidated statements of operations. During the three and nine months ended September 28, 2024, the Company recorded income related to the ATMP JV of $7 million and $21 million, respectively, in Equity income in investee on its consolidated statements of operations.

NOTE 8 – Debt, Revolving Credit Facility and Commercial Paper Program

Debt

The Company’s debt as of September 27, 2025 and December 28, 2024 consisted of the following:

			September 27, 2025						December 28, 2024
			(In millions)
4.212% Senior Notes Due 2026 (4.212% Notes)			$	875					$	—
4.319% Senior Notes Due 2028 (4.319% Notes)			625						—
2.375% Senior Notes Due 2030 (2.375% Notes)			750						750
3.924% Senior Notes Due 2032 (3.924% Notes)			500						500
4.393% Senior Notes Due 2052 (4.393% Notes)			500						500
Total debt (principal amount)			3,250						1,750
Unamortized debt discount and issuance costs			(30)						(29)
Total debt (net)			3,220						1,721
Less: current portion of long-term debt and related unamortized debt issuance costs			(873)						—
Total long-term debt (net)			$	2,347					$	1,721

4.212% Senior Notes Due 2026 and 4.319% Senior Notes Due 2028

On March 24, 2025, the Company issued 4.212% Notes and 4.319% Notes in aggregate principal amount of $1.5 billion. The 4.212% Notes and the 4.319% Notes are general unsecured senior obligations of the Company. The interest is payable semi-annually on March 24 and September 24 of each year, commencing on September 24, 2025.

The Company may redeem some or all of the 4.212% Notes prior to September 24, 2026 at a price equal to the greater of the present value of the principal amount and future interest through the maturity of the 4.212% Notes or 100% of the principal amount plus accrued and unpaid interest. The Company may redeem some or all of the 4.319% Notes prior to February 24, 2028, one month prior to the maturity date of the 4.319% Notes (4.319% Notes Par Call Date), at a price equal to the greater of the present value of the principal amount and future interest through the 4.319% Notes Par Call Date or 100% of the principal amount plus accrued and unpaid interest. On or after February 24, 2028, the Company may also redeem some or all of the 4.319% Notes at 100% of the principal amount plus accrued and unpaid interest.

Holders of the 4.212% Notes and the 4.319% Notes have the right to require the Company to repurchase all or a portion of the 4.212% Notes or 4.319% Notes in the event that the Company undergoes a change of control, at a repurchase price of 101% of the principal amount plus accrued and unpaid interest. Additionally, an event of default may result in the acceleration of the maturity of the 4.212% Notes and 4.319% Notes.

2.375% Senior Notes Due 2030, 3.924% Senior Notes Due 2032 and 4.393% Senior Notes Due 2052

The 2.375% Notes, 3.924% Notes and 4.393% Notes are general unsecured senior obligations of the Company with semi-annual fixed interest payments due on June 1 and December 1.

As of September 27, 2025, the Company was in compliance with the covenants associated with its debt.

Revolving Credit Facility

The Company has $3.0 billion available under an unsecured revolving credit facility that expires on April 29, 2027. During the three and nine months ended September 27, 2025, the Company did not draw funds from the revolving credit facility. As of September 27, 2025, the Company was in compliance with the covenants under the revolving credit facility.

Commercial Paper Program

The Company has a commercial paper program under which it can issue unsecured commercial paper notes up to a principal amount of $3.0 billion at any time with maturities of up to 397 days from the date of issue. The commercial paper will be sold at a discount from par or, alternatively, will be sold at par and bear interest at rates that will vary based on market conditions at the time of the issuance. During the three months ended March 29, 2025, the Company issued $950 million in aggregate principal amount of commercial paper which was subsequently repaid before June 28, 2025. As of September 27, 2025 and December 28, 2024, the Company had no commercial paper outstanding.

NOTE 9 – Financial Instruments

Financial Instruments Recorded at Fair Value on a Recurring Basis

			September 27, 2025																								December 28, 2024
(In millions)			Level 1						Level 2						Level 3						Total						Level 1						Level 2						Level 3						Total
Cash equivalents
Money market funds			$	732					$	—					$	—					$	732					$	1,496					$	—					$	—					$	1,496
Corporate debt securities			—						1,733						—						1,733						—						806						—						806
U.S. government and agency securities			312						400						—						712						130						—						—						130
Non-U.S. government and agency securities			—						165						—						165						—						116						—						116
Time deposits and certificates of deposits			—						179						—						179						—						107						—						107
Short-term investments
Corporate debt securities			—						1,525						—						1,525						—						814						—						814
U.S. government and agency securities			643						73						—						716						332						82						—						414
Non-U.S. government and agency securities			—						161						—						161						—						79						—						79
Time deposits and certificates of deposits			—						10						—						10						—						10						—						10
Asset-backed and mortgage-backed securities			—						23						—						23						—						28						—						28
Other non-current assets
Deferred compensation plan and other investments			238						—						121						359						197						—						25						222
Time deposits and certificates of deposits			—						—						—						—						—						1						—						1
Total assets measured at fair value			$	1,925					$	4,269					$	121					$	6,315					$	2,155					$	2,043					$	25					$	4,223
Accrued liabilities
Contingent consideration liability			$	—					$	—					$	413					$	413					$	—					$	—					$	—					$	—
Total liabilities measured at fair value			$	—					$	—					$	413					$	413					$	—					$	—					$	—					$	—

Deferred compensation plan investments are primarily mutual fund investments held in a Rabbi trust established to maintain the Company’s executive deferred compensation plan.

The following is a summary of cash equivalents and short-term investments:

			September 27, 2025																								December 28, 2024
			Cost/ Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Estimated Fair Value						Cost/ Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Estimated Fair Value
			(in millions)																								(in millions)
Money market funds			$	732					$	—					$	—					$	732					$	1,496					$	—					$	—					$	1,496
Corporate debt securities			3,256						2						—						3,258						1,621						—						(1)						1,620
U.S. government and agency securities			1,427						1						—						1,428						544						—						—						544
Non-U.S. government and agency securities			326						—						—						326						195						—						—						195
Time deposits and certificates of deposits			189						—						—						189						117						—						—						117
Asset-backed and mortgage-backed securities			24						—						(1)						23						30						—						(2)						28
			$	5,954					$	3					$	(1)					$	5,956					$	4,003					$	—					$	(3)					$	4,000

As of September 27, 2025 and December 28, 2024, the Company did not have material available-for-sale debt securities which have been in a continuous unrealized loss position of more than twelve months.

The contractual maturities of investments classified as available-for-sale are as follows:

			September 27, 2025												December 28, 2024
			Amortized Cost						Fair Value						Amortized Cost						Fair Value
			(In millions)												(In millions)
Due within 1 year			$	4,311					$	4,312					$	2,073					$	2,073
Due in 1 year through 5 years			887						889						406						405
Due in 5 years and later			24						23						27						26
			$	5,222					$	5,224					$	2,506					$	2,504

Financial Instruments Not Recorded at Fair Value

The carrying amounts and estimated fair values of the Company’s current and long-term debt are as follows:

			September 27, 2025												December 28, 2024
			Carrying Amount						Estimated Fair Value						Carrying Amount						Estimated Fair Value
			(In millions)												(In millions)
Current portion of long-term debt, net			$	873					$	880					$	—					$	—
Long-term debt			$	2,347					$	2,242					$	1,721					$	1,543

The estimated fair value of the Company’s long-term debt is based on Level 2 inputs of quoted prices for the Company’s debt and comparable instruments in inactive markets.

The fair value of the Company’s accounts receivable, accounts payable and other short-term obligations approximate their carrying value based on existing terms.

Financial Instruments Measured at Fair Value on a Non-Recurring Basis

As of September 27, 2025 and December 28, 2024, the Company had non-marketable securities in privately-held companies of $898 million and $468 million, respectively, which are recorded at estimated fair value on a non-recurring basis and within Other non-current assets in the Company’s consolidated balance sheets. Impairment losses or observable price adjustments were not material during the three and nine months ended September 27, 2025 and September 28, 2024.

Hedging Transactions and Derivative Financial Instruments

Foreign Currency Forward Contracts Designated as Accounting Hedges

The Company enters into foreign currency forward contracts to hedge its exposure to foreign currency exchange rate risk related to future forecasted transactions denominated in currencies other than the U.S. Dollar. These contracts generally mature within 24 months and are designated as accounting hedges. As of September 27, 2025 and December 28, 2024, the notional value of the Company’s outstanding foreign currency forward contracts designated as cash flow hedges was $2.3 billion and $2.2 billion, respectively. The fair value of these contracts as of September 27, 2025 and December 28, 2024 was not material.

Foreign Currency Forward Contracts Not Designated as Accounting Hedges

The Company also enters into foreign currency forward contracts to reduce the short-term effects of foreign currency fluctuations on certain receivables or payables denominated in currencies other than the U.S. Dollar. These forward contracts generally mature within 3 months and are not designated as accounting hedges. As of September 27, 2025 and December 28, 2024, the notional value of these outstanding contracts was $797 million and $642 million, respectively. The fair value of these contracts was not material as of September 27, 2025 and December 28, 2024.

NOTE 10 – Earnings Per Share

The following table sets forth the components of basic and diluted earnings per share:

			Three Months Ended												Nine Months Ended
			September 27, 2025						September 28, 2024						September 27, 2025						September 28, 2024
			(In millions, except per share amounts)
Numerator
Income from continuing operations			$	1,172					$	771					$	2,649					$	1,159
Income from discontinued operations			71						—						175						—
Net income			$	1,243					$	771					$	2,824					$	1,159
Denominator
Basic weighted average shares			1,626						1,620						1,623						1,619
Potentially dilutive shares from employee equity plans			15						16						9						19
Diluted weighted average shares			1,641						1,636						1,632						1,638
Earnings per share:
Earnings per share from continuing operations - basic			$	0.72					$	0.48					$	1.63					$	0.72
Earnings per share from discontinued operations - basic			0.04						—						0.11						—
Basic earnings per share			$	0.76					$	0.48					$	1.74					$	0.72
Earnings per share from continuing operations - diluted			$	0.71					$	0.47					$	1.62					$	0.71
Earnings per share from discontinued operations - diluted			0.04						—						0.11						—
Diluted earnings per share			$	0.75					$	0.47					$	1.73					$	0.71

Securities which would have been anti-dilutive are not material and are excluded from the computation of diluted earnings per share for all periods presented.

NOTE 11 – Common Stock and Stock-based Compensation

Common Stock

On May 14, 2025, the Company’s stockholders approved the Company’s Amended and Restated Certificate of Incorporation to increase the number of authorized shares of common stock from 2.25 billion shares to 4.0 billion shares.

Shares of common stock outstanding were as follows:

			Three Months Ended												Nine Months Ended
			September 27, 2025						September 28, 2024						September 27, 2025						September 28, 2024
			(In millions)
Balance, beginning of period			1,622						1,618						1,622						1,616
Common stock issued under employee equity plans			9						10						13						15
Common stock repurchases for tax withholding on equity awards			(3)						(3)						(3)						(4)
Repurchases of common stock			—						(2)						(12)						(4)
Common stock issued in the acquisition of ZT Systems			—						—						8						—
Balance, end of period			1,628						1,623						1,628						1,623

Stock Repurchase Program

On May 13, 2025, the Company’s board of directors approved a new $6 billion share repurchase program. The authorization is in addition to the Company’s existing share repurchase program (collectively, the Repurchase Program), increasing the total repurchase authority to $14 billion. During the three and nine months ended September 27, 2025, the Company repurchased 0.6 million and 12 million shares of its common stock under the Repurchase Program for $89 million and $1.3 billion, respectively. The repurchased amounts do not include the 1% excise tax on stock repurchases enacted by the Inflation Reduction Act of 2022. As of September 27, 2025, $9.4 billion remained available for future stock repurchases under the Repurchase Program. The Repurchase Program does not obligate the Company to acquire any common stock, has no termination date and may be suspended or discontinued at any time.

Stock-based Compensation

Stock-based compensation expense recorded in the consolidated statements of operations was as follows:

			Three Months Ended												Nine Months Ended
			September 27, 2025						September 28, 2024						September 27, 2025						September 28, 2024
			(In millions)
Cost of sales			$	7					$	5					$	18					$	16
Research and development			333						267						905						809
Marketing, general and administrative			79						79						229						243
Total			$	419					$	351					$	1,152					$	1,068

NOTE 12 – Income Taxes

The Company determines its income taxes for interim reporting periods by applying the Company’s estimated annual effective tax rate to the year-to-date results, adjusted for tax items discrete to each period.

Continuing Operations

For the three and nine months ended September 27, 2025, the Company recorded an income tax provision of $153 million and an income tax benefit of $558 million representing an effective tax rate of 11.5% and (26.7)%, respectively. The tax provision (benefit) for both periods reflected the income tax benefit from foreign-derived intangible income (FDII) and research and development (R&D) tax credits, partially offset by the tax rate detriment from foreign earnings, as well as a discrete tax benefit related to stock-based compensation. In addition, the tax benefit for the nine months ended September 27, 2025 also included a discrete tax benefit of $853 million related to the release of uncertain tax positions pertaining to the reasonable cause relief for dual consolidated losses approved by the Internal Revenue Service (IRS) in April 2025.

For the three and nine months ended September 28, 2024, the Company recorded an income tax benefit of $27 million and $38 million representing an effective tax rate of (3.6)% and (3.3)%, respectively. The tax benefit for the three and nine months ended September 28, 2024 reflected discrete tax benefits primarily related to stock-based compensation, partially offset by the interest and penalties accrued for uncertain tax positions.

In July 2025, the One Big Beautiful Bill Act (OBBBA) was enacted into law. For the three and nine months ended September 27, 2025, the primary impact of the OBBBA to the Company’s tax provision was the accelerated expensing of domestic R&D activities which decreased the Company’s estimated income eligible for FDII resulting in a higher estimated annual effective tax rate. The OBBBA is also expected to reduce the Company’s deferred tax assets and current income tax liability for fiscal year 2025. Other OBBBA changes did not have a material impact on the Company’s financial statements.

As of September 27, 2025 and December 28, 2024, the Company had long-term income tax liabilities related to unrecognized tax benefits of $763 million and $1.4 billion, respectively, recorded under Other long-term liabilities in the Company’s consolidated balance sheets. The reduction in long-term income tax liabilities was primarily due to the release of $853 million of uncertain tax positions pertaining to reasonable cause relief for dual consolidated losses approved by the IRS in April 2025.

Discontinued Operations

For the three and nine months ended September 27, 2025, the Company recorded income tax provisions of $25 million and $1 million, respectively, related to discontinued operations. The $1 million provision for the nine months ended September 27, 2025 primarily reflects a tax expense from the ZT Manufacturing Business, offset by a discrete tax benefit from its expected sale.

NOTE 13 – Commitments and Contingencies

Commitments

The Company’s commitments primarily include obligations to purchase wafers and substrates from third parties, obligations for future payments related to multi-year cloud service provider, software, technology and IP license agreements, and obligations for leases that have not yet commenced. These commitments were made under noncancellable purchase orders and contractual obligations requiring minimum commitments for which cancellation would lead to significant penalties.

Total future commitments as of September 27, 2025 were as follows:

Fiscal Year			(In millions)
Remainder of 2025			$	3,778
2026			3,960
2027			1,242
2028			1,231
2029			1,032
2030 and thereafter			882
Total commitments			$	12,125

The Company continually works with suppliers and partners on timing of payments and deliveries of commitments, taking into account business conditions.

Contingencies

During the quarterly period ended September 27, 2025, there were no material legal proceedings. The Company is a defendant or plaintiff in various actions that arose in the normal course of business. With respect to these matters, based on management’s current knowledge, the Company believes that the amount or range of reasonably possible loss, if any, will not, either individually or in the aggregate, have a material adverse effect on the Company’s financial position, results of operations, or cash flows.

NOTE 14 – Restructuring Charges

In the fourth quarter of 2024, the Company implemented a restructuring plan (the 2024 Restructuring Plan) which reduced the global workforce by approximately 4% of headcount. Actions associated with the 2024 Restructuring Plan were substantially completed in the first quarter of fiscal year 2025. The 2024 Restructuring Plan charges to date were $186 million, of which $113 million was related to employee severance and benefits and $73 million was related to asset impairment. For the three and nine months ended September 27, 2025, the Company made less than $1 million and $78 million of severance payments, respectively, and had no charges or adjustments to period expense under the 2024 Restructuring Plan. As of September 27, 2025 and December 28, 2024, restructuring plan liabilities of $11 million and $89 million, respectively, were recorded within Accrued liabilities in the Company’s consolidated balance sheets.

NOTE 15 - Subsequent Events

Warrant

On October 5, 2025, the Company issued to OpenAI OpCo, LLC (the Warrantholder) a warrant to purchase up to an aggregate of 160 million shares of the Company’s common stock at an exercise price of $0.01 per share. The warrant shares will vest in tranches based on certain GPU purchase milestones by the Warrantholder, or its affiliates, or indirectly through third parties, and achievement of specified Company stock price targets and stock performance. Each vested tranche is further subject to the fulfillment of certain other technical and commercial conditions prior to exercise. Subject to certain terms and conditions, the warrant is exercisable through October 5, 2030. The Company expects to account for the warrant as a liability-classified financial instrument, unless the conditions for equity classification are satisfied. The grant date fair value of the warrant will be recognized as a reduction to revenue when revenue is recognized. The warrant, when classified as a liability, will be remeasured at fair value at each reporting period, with changes in fair value to be recorded within Other income (expense), net.

ZT Manufacturing Business Divestiture

On October 27, 2025, the Company completed the sale of the ZT Manufacturing Business to Sanmina for 1,151,052 shares of Sanmina common stock and $2.4 billion in cash, subject to certain purchase price adjustments. The Company is eligible to receive additional cash consideration of up to $450 million to the extent certain conditions are met following the close of the sale.

On October 30, 2025, with the completion of the sale of the ZT Manufacturing Business, the Company settled the contingent consideration liability of $300 million in cash and 740,961 shares of the Company’s common stock with the former ZT Systems stockholders and warrant holders.