ADVANCED MICRO DEVICES INC Q1 FY2025 earnings call

• Strong first quarter performance with growth across segments despite tariffs and regulatory challenges. Data center segment saw 57% YOY revenue growth driven by EPYC CPUs and AI GPUs. Client and gaming segment up 28% YOY, with client revenue up 68% due to strong Ryzen processor sales. Embedded segment revenue down 3% but expected to recover in second half. • Acquisition of ZT Systems to enhance data center GPU and systems roadmaps. • Progress in data center AI with MI325X shipments ramping and strong customer engagements.

Data center segment revenue was $3.7 billion, up 57% year-over-year. Client and gaming segment revenue was $2.9 billion, up 28% year-over-year, with client revenue at $2.3 billion, up 68% year-over-year. Embedded segment revenue was $823 million, down 3% year-over-year.

• Q2 2025 revenue estimated at ~$7.4 billion +/- $300 million, including ~$700 million headwind from China export controls on MI308. • Full-year 2025 revenue impact from China export controls is ~$1.5 billion. • Q2 non-GAAP gross margin estimated at 43% inclusive of ~$800 million charges, excluding which it would be ~54%. • OpEx guidance for Q2 is ~$2.3 billion, including ~$50 million from ZT Systems.

• Export controls on Instinct MI308X shipments to China, impacting revenue. • Macroeconomic uncertainties and regulatory environment posing challenges. • Inventory build-up related to ramp-up of products for future quarters.

Q: Expand on drivers of upside in print and guide, and Q2 growth by segment, especially client.

A: Lisa Su notes strength across businesses, client had strong desktop performance with better ASPs, Q2 guide includes China export control headwind but rest of businesses strong.

Q: Ex-China Instinct family performance and back half outlook.

A: Lisa Su says Instinct ramp in Q1 was in line, MI350 launch on track with strong customer interest.

Q: Data center GPU growth, China impact, and gross margin.

A: Jean Hu says data center GPU had $700M impact in Q2, gross margin in Q2 includes charges but expected to improve in second half.

Q: MI400 and rack scale solution, go-to-market.

A: Lisa Su says MI400 development on track, working closely with partners to address deployment challenges.

Q: Embedded segment recovery and OpEx.

A: Jean Hu mentions embedded demand gradually recovering, OpEx for Q2 includes $50M from ZT Systems