“In the fourth quarter, we expect to pay approximately $550 million in cash taxes, primarily due to previously deferred taxes from California disaster relief efforts made available by the IRS.”

In context

“nt revenue declined 5%, in line with our expectations as we are now in the fourth year of the console cycle. Gaming segment operating income was $208 million or 14% of revenue compared to $142 million or 9% a year ago, primarily driven by higher Radeon GPU revenue. Embedded segment revenue was $1.2 billion, down 5% year-over-year, primarily due to lower sales to the communication market. On a sequential basis, Embedded segment revenue declined 15%, primarily due to inventory correction at customers in several end markets. Embedded segment operating income was $612 million or 49% of revenue compared to $635 million or 49% a year ago. Turning to the balance sheet and the cash flow. During the quarter, we generated $421 million in cash from operations and the free cash flow was $297 million. In the fourth quarter, we expect to pay approximately $550 million in cash taxes, primarily due to previously deferred taxes from California disaster relief efforts made available by the IRS. Inventory decreased sequentially by $122 million to $4.4 billion. At the end of the quarter, cash, cash equivalents and short-term investment was strong at $5.8 billion. We returned $511 million to shareholders, repurchasing 4.8 million shares and we have $5.8 billion in remaining share repurchase authorization. Now turning to our fourth quarter 2023 outlook. We expect revenue to be approximately $6.1 billion, plus or minus $300 million, an increase of approximately 9% year-over-year and 5% sequentially. Year-over-year, we expect revenue for the Data Center and the Client segments to be up by strong double-digit percentage, the Gaming segment to decline, given where we are in the console cycle, and the Embedded segment to decline due to additional softening of demand in the embedded marke”