AMD Reports Fourth Quarter and Full Year 2021 Financial Results

― Record quarterly revenue of $4.8B up 49% y/y; Record full year revenue of $16.4B up 68%;Gross margin expanded and operating income more than doubled from prior year ―

SANTA CLARA, Calif., Feb. 01, 2022 (GLOBE NEWSWIRE) -- AMD (NASDAQ:AMD) today announced revenue for the fourth quarter of 2021 of $4.8 billion, operating income of $1.2 billion, net income of $974 million and diluted earnings per share of $0.80. On a non-GAAP(*) basis, operating income was $1.3 billion, net income was $1.1 billion and diluted earnings per share was $0.92.

For full year 2021, the company reported revenue of $16.4 billion, operating income of $3.6 billion, net income of $3.2 billion and diluted earnings per share of $2.57. On a non-GAAP(*) basis, operating income was $4.1 billion, net income was $3.4 billion and diluted earnings per share was $2.79.

GAAP Quarterly Financial Results

Non-GAAP(*) Quarterly Financial Results

Annual Financial Results

“2021 was an outstanding year for AMD with record annual revenue and profitability,” said AMD President and CEO Dr. Lisa Su. “Each of our businesses performed extremely well, with data center revenue doubling year-over-year driven by growing adoption of AMD EPYC processors across cloud and enterprise customers. We expect another year of significant growth in 2022 as we ramp our current portfolio and launch our next generation of PC, gaming and data center products.”

Q4 2021 Results

• Revenue of $4.8 billion was up 49 percent year-over-year and 12 percent quarter-over-quarter driven by higher revenue in the Computing and Graphics and Enterprise, Embedded and Semi-Custom segments.

• Gross margin was 50 percent, an increase of more than 5 percentage points year-over-year and approximately 2 percentage points quarter-over-quarter. The year-over-year and quarter-over-quarter increases were primarily driven by a richer product mix.

• Operating income was $1.2 billion compared to $570 million a year ago and $948 million in the prior quarter. Non-GAAP operating income was $1.3 billion compared to $663 million a year ago and $1.1 billion in the prior quarter. Operating income improvements were primarily driven by higher revenue and gross margin expansion.

• Net income was $974 million compared to $1.8 billion a year ago, which included a $1.3 billion income tax benefit associated with a valuation allowance release, and $923 million in the prior quarter. Non-GAAP net income was $1.1 billion compared to $636 million a year ago and $893 million in the prior quarter.

• Diluted earnings per share was $0.80 compared to $1.45 a year ago, which included a $1.06 per share income tax benefit, and $0.75 in the prior quarter. Non-GAAP diluted earnings per share was $0.92 compared to $0.52 a year ago and $0.73 in the prior quarter.

• Cash, cash equivalents and short-term investments were $3.6 billion at the end of the quarter. The company repurchased $756 million of common stock during the quarter.

• Cash from operations was $822 million in the quarter compared to $554 million a year ago and $849 million in the prior quarter. Free cash flow was $736 million in the quarter compared to $480 million a year ago and $764 million in the prior quarter. Fourth quarter cash from operations and free cash flow included strategic investments in long-term supply chain capacity to support future revenue growth.

Quarterly Financial Segment Summary

• Computing and Graphics segment revenue was $2.6 billion, up 32 percent year-over-year and up 8 percent quarter-over-quarter. The year-over-year and quarter-over-quarter increases were driven by Ryzen™ and Radeon™ processor sales.

  • Client processor average selling price (ASP) increased year-over-year and quarter-over-quarter due to a richer mix of Ryzen processor sales.

  • GPU ASP increased year-over-year primarily driven by Radeon product sales and decreased quarter-over-quarter due to product mix.

  • Operating income was $566 million compared to $420 million a year ago and $513 million in the prior quarter. Operating income improvements were primarily driven by higher revenue, partially offset by higher operating expenses.

• Enterprise, Embedded and Semi-Custom segment revenue was $2.2 billion, up 75 percent year-over-year and 17 percent quarter-over-quarter driven by higher EPYC™ and semi-custom processor sales.

  • Operating income was $762 million compared to $243 million a year ago and $542 million in the prior quarter. Operating income improvements were primarily driven by higher revenue and richer product mix, partially offset by higher operating expenses.

• All Other operating loss was $121 million as compared to operating losses of $93 million a year ago and $107 million in the prior quarter.

2021 Annual Results

• Revenue of $16.4 billion was up 68 percent over 2020 driven by higher revenue in the Computing and Graphics and Enterprise, Embedded and Semi-Custom segments.

• Gross margin was 48 percent, an increase of more than 3 percentage points over 2020. Gross margin expansion was driven by a richer mix of EPYC, Radeon and Ryzen processor sales.

• Operating income was $3.6 billion compared to $1.4 billion in the prior year. Non-GAAP operating income was $4.1 billion compared to $1.7 billion in the prior year. The operating income improvement was primarily driven by higher revenue and gross margin expansion.

• Net income was $3.2 billion compared to $2.5 billion in the prior year, which included a $1.3 billion income tax benefit recorded in the fourth quarter of 2020. Non-GAAP net income was $3.4 billion compared to $1.6 billion in the prior year.

• Diluted earnings per share was $2.57 compared to $2.06 in the prior year (which included a $1.07 per share income tax benefit). Non-GAAP diluted earnings per share was $2.79 compared to $1.29 in the prior year.

• Cash, cash equivalents and short-term investments were $3.6 billion at the end of the year. The company repurchased $1.8 billion of common stock during 2021.

• Cash from operations was $3.5 billion compared to $1.1 billion in the prior year. Free cash flow was $3.2 billion compared to $777 million in the prior year. Annual cash from operations and free cash flow in 2021 included strategic investments in long-term supply chain capacity to support future revenue growth.

Recent PR Highlights

• AMD announced it received approval from the State Administration for Market Regulation (SAMR) of the People’s Republic of China for the acquisition of Xilinx. AMD anticipates that the acquisition will close in the first quarter of 2022.

• AMD continues to drive strong momentum in the data center with growing adoption of powerful AMD EPYC processors, AMD Instinct™ accelerators and data center solutions with new customers and expanded cloud offerings.

  • Leading cloud providers expanded their AMD-powered offerings with more than 130 new public instances launching in the quarter including: Amazon Web Services, Inc. (AWS) introduced the new Amazon EC2 Hpc6a instances that make high performance computing more accessible for customers with compute-intensive workloads and the new general-purpose Amazon EC2 M6a instances; Google Cloud launched multiple general purpose and compute- and memory-intensive instances; IBM Cloud launched new bare metal service offerings for demanding workloads and solutions; and Microsoft Azure announced the latest generation of Dasv5 and Easv5 Azure Virtual Machines (VMs) and new confidential VMs, DCasv5 and ECasv5.

  • AMD and Meta worked together to define an open, cloud-scale, single-socket server based on AMD EYPC CPUs for Meta’s newest “North Dome” systems with leadership performance-per-watt across major workloads.

  • AMD announced the new AMD Instinct MI200 series accelerators, the fastest accelerators for HPC and AI applications. The MI200 series accelerators are powering Oak Ridge National Laboratory’s Frontier supercomputer, the first Exascale supercomputer in the United States.

  • In the latest Top500 list, AMD now powers 73 supercomputers, a more than 3x increase compared to the November 2020 list. AMD also powers four out of the top 10 most powerful supercomputers in the world, as well as the most powerful supercomputer in EMEA.

  • NVIDIA is adopting Ryzen™ Threadripper™ PRO processors to help power next-generation cloud gaming experiences.

  • AMD announced the AMD Radeon PRO V620 GPU, delivering powerful data center visual performance for 3D workloads, modern office productivity applications and cloud gaming, including Tencent’s upcoming cloud gaming service.

• At its 2022 Product Premiere event, AMD announced the AMD Ryzen 6000 Series processors, built on the highly efficient 6nm “Zen 3+” core architecture, and including AMD RDNA™ 2 architecture-based integrated graphics to provide the fastest Ryzen mobile processor experience ever. AMD expects first system availability starting in February.

• AMD announced new updates to its graphics processor lineup and software portfolio, including new AMD Radeon RX 6000M Series and AMD Radeon RX 6000S Series mobile graphics for premium and thin-and-light gaming laptops, three new AMD Radeon RX 6000 Series desktop graphics cards for 1080p gaming, and AMD Radeon Super Resolution, a new driver-based spatial upscaling technology available in the upcoming update to the AMD Software: Adrenalin Edition application.

• AMD delivered a first look at its next wave of leadership data center and desktop PC processors which will set the pace of industry innovation.

  • AMD provided a preview of 3rd Gen AMD EPYC processors with AMD 3D V-Cache™, the “Zen 4” processor core powering the next generation of EPYC processors, codenamed “Genoa,” and the new “Zen 4c” processor core, which is designed for cloud native workloads and will power the EPYC processor codenamed “Bergamo.”

  • AMD also announced the first AMD Ryzen processors with AMD 3D V-Cache technology to power incredible gaming experiences and previewed its Ryzen 7000 Series processors, which will be based on the 5nm “Zen 4” architecture and are expected to be available in the second half of 2022.

• AMD was recognized on Newsweek’s America’s Most Responsible Companies 2022 list for environmental, social and corporate governance efforts.

Current OutlookAMD’s outlook statements are based on current expectations. The following statements are forward-looking and actual results could differ materially depending on market conditions and the factors set forth under “Cautionary Statement” below.

For the first quarter of 2022, AMD expects revenue to be approximately $5.0 billion, plus or minus $100 million, an increase of approximately 45 percent year-over-year and approximately 4 percent quarter-over-quarter. The year-over-year increase is expected to be driven by growth across all businesses. The quarter-over-quarter increase is expected to be driven by higher server and client processor revenue. AMD expects non-GAAP gross margin to be approximately 50.5 percent in the first quarter of 2022.

For the full year 2022, AMD expects revenue to be approximately $21.5 billion, an increase of approximately 31 percent over 2021 driven by growth across all businesses. AMD expects non-GAAP gross margin to be approximately 51 percent for 2022.

AMD TeleconferenceAMD will hold a conference call for the financial community at 2:00 p.m. PT (5:00 p.m. ET) today to discuss its fourth quarter and full year 2021 financial results. AMD will provide a real-time audio broadcast of the teleconference on the Investor Relations page of its website at www.amd.com.

About AMD

For more than 50 years, AMD has driven innovation in high-performance computing, graphics and visualization technologies - the building blocks for gaming, immersive platforms and the data center. Hundreds of millions of consumers, leading Fortune 500 businesses and cutting-edge scientific research facilities around the world rely on AMD technology daily to improve how they live, work and play. AMD employees around the world are focused on building great products that push the boundaries of what is possible. For more information about how AMD is enabling today and inspiring tomorrow, visit the AMD (NASDAQ: AMD) website, blog, Facebook and Twitter pages.

Cautionary Statement

This press release contains forward-looking statements concerning Advanced Micro Devices, Inc. (AMD) such as the features, functionality, performance, availability, timing and expected benefits of AMD products; AMD’s expected first quarter 2022 and fiscal 2022 financial outlook, including revenue and non-GAAP gross margin and expected drivers based on current expectations; expected growth in 2022; and the expected timing of the close of the Xilinx, Inc. transaction, which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are commonly identified by words such as "would," "may," "expects," "believes," "plans," "intends," "projects" and other terms with similar meaning. Investors are cautioned that the forward-looking statements in this press release are based on current beliefs, assumptions and expectations, speak only as of the date of this press release and involve risks and uncertainties that could cause actual results to differ materially from current expectations. Such statements are subject to certain known and unknown risks and uncertainties, many of which are difficult to predict and generally beyond AMD's control, that could cause actual results and other future events to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. Material factors that could cause actual results to differ materially from current expectations include, without limitation, the following: Intel Corporation’s dominance of the microprocessor market and its aggressive business practices; global economic uncertainty; loss of a significant customer; impact of the COVID-19 pandemic on AMD’s business, financial condition and results of operations; competitive markets in which AMD’s products are sold; market conditions of the industries in which AMD products are sold; cyclical nature of the semiconductor industry; quarterly and seasonal sales patterns; AMD's ability to adequately protect its technology or other intellectual property; unfavorable currency exchange rate fluctuations; ability of third party manufacturers to manufacture AMD's products on a timely basis in sufficient quantities and using competitive technologies; availability of essential equipment, materials, substrates or manufacturing processes; ability to achieve expected manufacturing yields for AMD’s products; AMD's ability to introduce products on a timely basis with expected features and performance levels; AMD's ability to generate revenue from its semi-custom SoC products; potential security vulnerabilities; potential security incidents including IT outages, data loss, data breaches and cyber-attacks; uncertainties involving the ordering and shipment of AMD’s products; AMD’s reliance on third-party intellectual property to design and introduce new products in a timely manner; AMD's reliance on third-party companies for design, manufacture and supply of motherboards, software and other computer platform components; AMD's reliance on Microsoft and other software vendors' support to design and develop software to run on AMD’s products; AMD’s reliance on third-party distributors and add-in-board partners; impact of modification or interruption of AMD’s internal business processes and information systems; compatibility of AMD’s products with some or all industry-standard software and hardware; costs related to defective products; efficiency of AMD's supply chain; AMD's ability to rely on third party supply-chain logistics functions; AMD’s ability to effectively control sales of its products on the gray market; impact of government actions and regulations such as export administration regulations, tariffs and trade protection measures; AMD’s ability to realize its deferred tax assets; potential tax liabilities; current and future claims and litigation; impact of environmental laws, conflict minerals-related provisions and other laws or regulations; impact of acquisitions, joint ventures and/or investments on AMD's business, including the announced acquisition of Xilinx, and ability to integrate acquired businesses; AMD’s ability to complete the Xilinx merger; impact of the announcement and pendency of the Xilinx merger on AMD’s business; impact of any impairment of the combined company’s assets on the combined company’s financial position and results of operation; restrictions imposed by agreements governing AMD’s notes and the revolving credit facility; AMD's indebtedness; AMD's ability to generate sufficient cash to meet its working capital requirements or generate sufficient revenue and operating cash flow to make all of its planned R&D or strategic investments; political, legal, economic risks and natural disasters; future impairments of goodwill and technology license purchases; AMD’s ability to attract and retain qualified personnel; AMD’s stock price volatility; and worldwide political conditions. Investors are urged to review in detail the risks and uncertainties in AMD’s Securities and Exchange Commission filings, including but not limited to AMD’s most recent reports on Forms 10-K and 10-Q.

AMD, the AMD Arrow logo, EPYC, Radeon, Ryzen, Instinct, Threadripper and combinations thereof, are trademarks of Advanced Micro Devices, Inc. Other names are for informational purposes only and used to identify companies and products and may be trademarks of their respective owner.

Media Contact:Drew PrairieAMD Communications512-602-4425drew.prairie@amd.com

Investor Contact:Laura GravesAMD Investor Relations408-749-5467laura.graves@amd.com