Advanced Micro Devices Inc (AMD)

“The Helios ramp is just starting at the end of Q3 and will be much more substantial in Q4, which should give you the picture: Q3 is a strong quarter with very strong double-digit growth in the data center segment, and Q4 will be higher than that.”

“We are guiding the data center segment to grow sequentially double digits.”

“Tim, we believe server CPU will grow substantially in Q3 and Q4.”

“Going forward, expect both unit and ASP growth.”

“In terms of revenue per gigawatt, we have said double-digit billions and remain in that range.”

“For Helios, we expect a significant ramp over the next few quarters: Q3 is the very beginning, Q4 is a step-up, and Q1 of 2027 will be a further step-up as we continue to ramp through 2027.”

“For overall data center, for 2027 we have given some color: server CPU portion will grow by over 70% year-over-year off a higher base, and the overall segment will grow by over 100% because of the data center AI ramp.”

“With our view of the TAM being greater than 40%, we also expect to grow greater than that from an overall revenue standpoint for the company.”

“Expect more growth for each of those businesses in Q4 with more supply coming online for server as well as for data center AI.”

“Additionally, our Embedded business is recovering significantly and should provide additional tailwind on gross margin in 2027.”

“Overall, we feel good about navigating this transition and continuing to improve our gross margin.”

“The way to think about it is both businesses are going to grow substantially.”

“We expect server to grow over 80% in the second half year-over-year.”

“We expect MI500 to deliver the largest generational leap in Instinct history putting us on track to increase inference performance more than 2,000 times in just four years.”

“Looking beyond Helios, we plan to launch a new rack-scale AI platform every year with each generation delivering significant performance, efficiency and TCO gains.”

“Helios is now in production with initial shipments on track to begin later this quarter and ramp through the fourth quarter and into 2027 to meet very strong customer demand.”

“Anthropic will deploy up to 2 gigawatts of MI450 series GPUs in Helios with deployment of the first gigawatt beginning in the first half of 2027.”

“Customer demand for Venice is stronger than for any prior EPYC generation, and we expect to continue growing market share across cloud and enterprise in the coming quarters.”

“Venice is in production now with every major OEM on track to launch platforms and the leading cloud providers planning deployments beginning later this year.”

“We now expect revenue to grow substantially above our prior target of greater than 35%, and we expect to significantly exceed our $20 annual EPS target within our strategic timeframe.”

“We now see the overall market for high performance in AI computing growing approximately 40% annually over the next several years, approaching $2 trillion by 2030, and we expect to grow well above the market.”

“We are tracking towards another record year with more than $18 billion of new design wins, led by major wins with networking, data center, communications, test, and aerospace and defense customers.”

“Against this backdrop, we expect our client business to perform better than the market, driven by the strength of our Ryzen portfolio and growing commercial adoption.”

“Looking to the second half of the year, we are planning for a softer PC market as higher memory and component costs weigh on demand.”

“Taken together, we now expect data center segment revenue to more than double year-over-year in 2027.”

“In server CPUs, with very strong customer demand and improved supply, we now expect server revenue to grow more than 80% year-over-year in the second half of 2026 and more than 70% for the full year 2027, off a much higher base.”

“In data center AI, the growing number and scale of Helios and MI450 Series Instinct deployments position the business for significant growth in the second half of the year with growth accelerating in 2027.”

“And we expect the server CPU market to grow more than 50% annually to approximately $220 billion by 2030.”

“We now expect the data center AI accelerator market to grow more than 45% annually to approximately $1.4 trillion by 2030.”

“So we guided data center Q2, up sequentially double digits, and that's double digits in both Server as well as Data Center AI.”

“Non-GAAP effective tax rate to be 13%, and the diluted share count is expected to be approximately 1.66 billion shares.”

“In addition, we expect second quarter non-GAAP gross margin to be approximately 56%, non-GAAP operating expenses to be approximately $3.3 billion, non-GAAP other income and expense to be a gain of approximately $60 million.”

“Sequentially, we expect revenue to be up approximately 9% driven by double-digit growth in both our Data Center and the Embedded segments and modest growth in our Client and Gaming segment.”

“At the middle of our guidance, revenue is expected to be up 46% year-over-year driven by a very strong growth in our Data Center segment, growth in our Client and Gaming segment and a double-digit growth in our Embedded segment.”

“We expect revenue to be approximately $11.2 billion, plus or minus $300 million.”

“Looking ahead, we expect demand for our Ryzen CPUs to remain solid in the second quarter.”

“As a result, we now expect server CPU revenue to grow by more than 70% year-over-year in the second quarter, with robust growth continuing through the second half of 2026 and into 2027 as we ramp our next-generation EPYC processors.”

“But when we sit here, when we look at all the positive trends we have to really offset some of the gross margin dilution from MI450 side, we actually feel really good about the setup of the gross margin for 2026.”

“And based on all of that and the scale of new customer interest, we see a path to really get to exceed our original targets of greater than 80% CAGR.”

“We feel really good about the market as well as our opportunity to grow to greater than 50% share of that market.”

“With the momentum we are seeing across the business and the expanding market opportunity, we see a clear path to exceed our long-term financial targets, including delivering more than $20 in EPS over the strategic time frame.”

“With this expanded visibility, we have strong and increasing confidence in our ability to deliver tens of billions of dollars in annual Data Center AI revenue in 2027 and to exceed our long-term growth target of greater than 80% in the coming years.”

“We have begun sampling MI450 series GPUs to lead customers and remain on track to ramp Helios production shipments in the second half of the year.”

“Shipments are on track to begin in the second half of the year, leveraging our Helios rack-scale architecture, which integrates Instinct GPUs with EPYC Venice CPUs to deliver fully optimized high-performance AI infrastructure.”

“Customer demand is very strong with more customers validating and ramping platforms at this stage than with any prior EPYC generation, and we remain on track to launch Venice later this year.”

“But going forward, you should expect the year-over-year growth R&D will grow faster than SG&A growth.”

“I think for the year, you should expect us to grow R&D much faster than SG&A.”

“We believe that we will continue to grow on a year-over-year basis for the Client business compared to last year.”

“As we go forward for Q2 and into the second half, we are guiding for a significant amount of growth.”

“We actually, during our financial Analyst Day, we outlined the long-term gross margin in the range of 55% to 58%. We think for the first year, we are making good progress there.”

“MI450 will start to ramp in Q3 and then ramp significantly in Q4. That is below corporate average.”

“And on the Data Center AI side, we will be ramping Helios in the second half of the year, so let's call it, starting with initial volume in Q3 with a significant ramp in Q4 and then continuing to ramp in Q1.”

“We now expect second half gaming revenue to decline more than 20% compared to the first half.”

“Similar to the PC market, we believe that second half demand in gaming will be impacted by higher memory and component costs, and we are planning the business accordingly.”

“Against this backdrop, we still expect our client revenue to grow year-over-year and outperform the market, driven by the strength of our Ryzen portfolio and expanding commercial adoption.”

“However, we are planning for second half PC shipments to be lower due to higher memory and component costs.”

“We are expecting that there could be some demand -- sort of the demand impact as a result of the memory price increases on things like the PC business in the second half of the year as well as the Gaming business.”

“Valve is on track to begin shipping its AMD-powered steam machine early this year.”

“We are not forecasting any additional revenue from China just because it's a very dynamic situation.”

“But data center is actually going to be up. And when you think about this, right, our CPU business seasonal actually, you know, regular seasonal pattern it's going to be down high single digit. And then in our current guide, we actually guide the CPU revenue up sequentially very nicely.”

“And diluted share count is expected to be approximately 1.65 billion shares.”

“Non-GAAP other net income to be approximately $35 million, non-GAAP effective tax rate to be 13%.”

“Jim, we are planning this at the, you know, every component level. So I think relative to our data center AI ramp, I do not believe that we will be supply limited in terms of the ramp that we put in place.”

“I mean, we're working closely with our suppliers over a multiyear time frame... So from that standpoint, I think we're well-positioned to grow substantially in 2026.”

“The ramp is, on schedule to start in the second half of the year. MI450 is doing, great. Helios is doing well.”

“Even in that environment with the PC market down, we believe we can grow our PC business.”

“As we get into 2026 and as we see some of the significant growth that we're expecting, we should absolutely see leverage.”

“We have increased our supply capacity capability for server CPUs. And, you know, that's one of the reasons we're able to increase our Q1 guide as it relates to the server business. And we see the ability to continue to grow that throughout the year.”

“But as we get into the second half of the year, the MI450 is really an inflection point for us. So that revenue will start in the third quarter, but it will ramp significant volume in the fourth quarter as we get into 2027.”

“So we feel very good about sort of the data center growth overall for us in '26. And then certainly going into 2027, you know, we've talked about, you know, tens of billions of dollars of data center AI revenue, and we feel very good about that.”

“So we're very happy with the progress that we have. We're right on track for a second-half launch and, you know, beginning production.”

“Looking ahead, we are very well positioned for continued strong top-line revenue growth and earnings expansion in 2026.”

“Significantly expanding operating margins, and generating annual EPS of more than $20 in the strategic time frame driven by growth in all of our segments and the rapid scaling of our data center AI business.”

“Looking further ahead, we see a clear path to achieve the ambitious targets we laid out at our Financial Analyst Day last November, including growing revenue at greater than 35% CAGR over the next three to five years.”

“And development of Microsoft's next-gen Xbox featuring an AMD semi-custom SoC is progressing well to support a launch in 2027.”

“Based on the strength of our EPYC and Instinct roadmaps, we are well-positioned to grow data center segment revenue by more than 60% annually, over the next three to five years and scale our AI business to tens of billions in annual revenue in 2027.”

“Our next-generation Venice CPU extends our leadership across each of these metrics. Customer pull for Venice is very high with engagements underway to support large-scale cloud deployments and broad OEM platform availability when Venice launches later this year.”

“We do expect the revenue on the semi-customer revenue side to come down significantly double-digit. For 2026.”

“In 2026, you should expect us to continue to invest aggressively. But as Lisa mentioned earlier, we do expect revenue to expand faster than operating expense increase to drive the earnings per share expansion.”

“And, you know, as we look forward, I think we are optimistic about the MI450 ramp for OpenAI.”

“The way we are modeling the year is, let's call it, second half a bit subseasonal to first half. Just given everything that we see.”

“And the way to think about it is we've always said in our long-term model, that OpEx should grow slower than revenue, and we would expect that in, you know, 2026 as well, especially as we get into the second half of the year and we see inflection in the revenue.”

“So far, so good. We are getting the let's call it a lot of input from our customers on, you know, things to test that we can do a lot of testing in parallel. And, you know, our expectation is that we will be on track for our second-half launch.”

“But for 2026, I would say the vast majority of it is going to be RackScale solutions. And yes, we will take revenue when we ship to the rack builder.”

“In addition, certainly, we see the recovery of our embedded business which is also margin accretive. So all those tailwinds we are seeing, we continue to see in next few quarters and our gross margin will be when MI450 ramp, of course, in Q4, driven largely by mix.”

“We see that as a strong growth driver for us. As Jean said, we see server CPU growing from Q4 into Q1 in what normally is seasonally down. And that continues throughout the year.”

“As a result, we expect significant top-line and bottom-line growth in 2026, led by increased adoption of EPYC and Instinct, continued client share gains, and a return to growth in our Embedded segment.”

“For 2026, we expect semi-custom SoC annual revenue to decline by a significant double-digit percentage as we enter the seventh year of what has been a very strong console cycle.”

“We are on track to launch MI500 in 2027 and expect MI500 to deliver another major leap in AI performance to power the next wave of large-scale multimodal models.”

“I mean, we'll certainly, you know, talk about that going forward. But as we ramp the new generation you would expect a reversal of that.”

“We're not, you know, obviously, guiding specifically by segment, but the long-term target of let's call it, greater than 60% is certainly possible in 2026.”

“We are on track for a second straight year of record design wins already totaling more than $14 billion year-to-date, reflecting the growing adoption of our leadership products across a broad range of markets and expanding set of applications.”

“Lux AI will provide a secure open platform for large-scale training and distributed inference when it comes online in early 2026.”

“We expect our non-GAAP effective tax rate to be 13%, and diluted share count is expected to be approximately 1.65 billion shares.”

“We expect net interest and other expenses to be a gain of approximately $37 million.”

“In addition, we expect fourth quarter non-GAAP gross margin to be approximately 54.5%”

“Sequentially, we expect revenue to grow by approximately 4% driven by double-digit growth in the data center segment with strong growth in server and continued ramp of our MI350 Series GPUs, a decline in our client and gaming segment with client revenue increasing and the gaming revenue down strong double digits, and double-digit growth in our embedded segment.”

“The midpoint of our guidance represents approximately 25% year-over-year revenue growth driven by strong double-digit growth in our data center, and client and gaming segment and a return to growth in our embedded segment.”

“Looking ahead, we see significant opportunity to continue growing our client business faster than the overall PC market based on the strength of our Ryzen portfolio, broader platform coverage and expanded go-to-market investments.”

“Many customers are now planning substantially larger CPU build-outs over the coming quarters to support increased demands from AI serving as a powerful new catalyst for our server business.”

“We expect cloud demand to remain very strong as hyperscalers are significantly increasing their general-purpose compute capacity as they scale their AI workloads.”

“I do feel like it's durable. It is not a short-term thing. I think it is a multi-quarter phenomenon as we're seeing just much more demand as these AI workloads really turn into -- you have to do real work.”

“The net-net is, I think, we are well positioned to grow significantly as we transition into the second half of '26 into '27 with the MI450 and Helios.”

“The key point is the first gigawatt, we will start deploying in the second half of '26 and that work is well underway.”

“In summary, our AI business is entering a new phase of growth and is on a clear trajectory towards tens of billions in annual revenue in 2027 driven by our leadership rack-scale solutions, expanding customer adoption and an increasing number of large-scale global deployments.”

“Oracle announced they will also be a lead launch partner for the MI450 Series, deploying tens of thousands of MI450 GPUs across Oracle Cloud Infrastructure beginning in 2026 and expanding through 2027 and beyond.”

“We announced a comprehensive multiyear agreement with OpenAI to deploy 6 gigawatts of Instinct GPUs with the first gigawatt of MI450 Series accelerators scheduled to start coming online in the second half of 2026.”

“Development of both our MI400 Series GPUs and Helios rack is progressing rapidly, supported by deep technical engagements across a growing set of hyperscalers, AI companies and OEM and ODM partners to enable large-scale deployments next year.”

“Looking ahead, our data center AI business is entering its next phase of growth with customer momentum building rapidly ahead of the launch of our next-gen MI400 Series accelerators and Helios rack-scale solutions in 2026.”

“Looking ahead, we remain on track to launch our next-generation 2-nanometer Venice processors in 2026.”

“There are multiple customers that we would expect to have, let's call it, very significant scale in the MI450 generation.”

“Our priority in data center GPU business is to really expand the top line revenue growth and the gross margin dollars, and of course, at the same time, we'll continue to drive the gross margin percentage up, too.”

“I think in general, as we said in the past for our data center GPU business, the gross margin continue to improve when we ramp a new generation of product.”

“So in terms of rack-scale solutions, we would expect that the early customers for MI450 will really be around the rack-scale solutions.”

“But given what we see today, we see a very good demand environment into 2026.”

“So we would expect that MI355 continue to ramp in the first half of '26 and then, as we mentioned, MI450 Series comes online in the second half of 2026, and we would expect a sharper ramp as we go into the second half of 2026 of our data center AI business.”

“We expect this partnership will significantly accelerate our data center AI business with the potential to generate well over $100 billion in revenue over the next few years.”

“In summary, demand is very strong across our product portfolio, and we are well positioned to deliver significant growth in the second half of the year, led by the steep ramp of MI350 series accelerators and ongoing EPYC and Ryzen share gains.”

“Looking more broadly, we remain confident we can continue growing client processor revenue ahead of the market over the coming quarters, driven by increased adoption of our desktop and notebook products, growing commercial momentum and a richer product mix.”

“Yes, Ben, it will take some time to ramp, just given -- particularly today, I mean, we're sitting already in early August, so I don't think you would see a lot of it in Q3. But certainly, as licenses would be approved, we would schedule that, and it would take a little while to ramp.”

“Certainly, as second half this year, it's all about MI355 ramp into first half of next year.”

“Yes. I think when you look at our Data Center business, we do have a strong double-digit growth, both in server and MI. Both sides are growing sequentially.”

“One of the things, just as a reminder, that the MI355 is -- given that it's a similar infrastructure to MI300, we actually think it's going to ramp very quickly and very well for customers, and I think that's one of the attractive portions of it as well.”

“I don't think it adds meaningfully to revenue in the second half of the year, but it certainly adds to customers getting experience with AMD.”

“But you should think about is a trend in the longer term, it should improve continually going forward.”

“So I think all of those are tailwinds for our Client business beyond the second half of '25 but really into the next number of quarters as we think about the portfolio and the opportunities for us.”

“We'll ramp more in the second half of the year.”

“We are expecting some growth in the Client business, so I wouldn't say it'll be flat to the first half, but it will be -- we're planning for it to be a little bit less than seasonal just given some of the uncertainties out there.”

“We expect our non- GAAP effective tax rate to be 13%, and diluted share count is expected to be approximately 1.63 billion shares.”

“We expect net interest and other expenses to be a gain of approximately $10 million.”

“Looking ahead, we expect improving demand in the test and measurement, communications, and aerospace markets will drive a return to sequential growth in the second half of 2025.”

“We expect to continue growing our commercial client share based on the strength of our product portfolio and expanded breadth of OEM offerings.”

“Despite that, we expect Instinct revenue to grow year-over-year in the third quarter, driven by the ramp of MI350 at multiple customers.”

“We began volume production of the MI350 series ahead of schedule in June and expect a steep production ramp in the second half of the year to support large-scale production deployments with multiple customers.”

“Looking ahead, we see a clear path to scaling our AI business to tens of billions of dollars in annual revenue.”

“We would expect significant revenue contribution from Helios in 2026.”

“But we do believe that it will grow year-over-year going forward in Q3 and Q4 certainly for us to do the full year with strong double-digit growth.”

“We absolutely believe the data center GPU will grow and we think it will grow strong double digits. We had a plan that was second half weighted and it still is.”

“we remain confident we can deliver strong double-digit-percentage revenue growth in 2025 based on accelerating share gains with our latest generation of Zen 5 EPYC and Ryzen CPUs and Radeon GPUs, and ramping production of our Instinct MI350 series accelerators in the second half of the year to support an expanded set of customers and AI workloads.”

“We remain confident we can grow client processor revenue well ahead of the market in 2025, led by expanding adoption of our desktop channel and consumer and commercial notebook portfolio, as well as a richer mix.”

“Customer interest in the MI350 series is very strong, setting the stage for broad deployment in the second half of this year.”

“We began sampling our next-gen MI350 series with multiple customers in the first quarter and remain on track to begin accelerated production by mid-year.”

“Look, we want to be very clear that our client business performance is primarily driven by the strength of the product portfolio... we are planning for let's call it second half sub seasonal given we're off to a strong start in the first half of the year.”

“Overall, when we think about the second half, we actually think the gross margin will improve slightly because data center continues to be very strong growth driver, number one growth driver, second half versus the first half, which will be partially offset by continued strength on the client and the gaming side.”

“But remember what Lisa mentioned is that we do see second half weighted. As we launch MI355, we will see significant ramp. Year-over-year, we see strong double digital growth of our data center business and the GPU business also.”

“So think about, Jean mentioned $1.5 billion, you would see the majority of it in Q2 and Q3 with very little in Q4.”

“we would expect strong growth into the second half of the year.”

“And from a data center side, we see sequential growth on the CPU side.”

“We see continued strength in gaming. I would say much better than typical seasonality.”

“We're also seeing the beginning of the commercial ramp, which is a place where we have traditionally been quite underrepresented.”

“Non-GAAP effective tax rate to be 13%, and the diluted share count is expected to be approximately 1.64 billion shares, which includes 9 million shares related to the ZT transaction.”

“We expect net interest and other expenses to be $5 million due to the debt associated with the ZT System transaction.”

“Excluding this charge, our non-GAAP gross margin would be approximately 54%.”

“Sequentially, we expect client and gaming segment revenue to increase by a double-digit percentage, embed segment revenue to be flattish, and we expect data center segment revenue to decrease due to the exclusion of MI308 revenue.”

“For the full year 2025, we estimated the revenue impact due to the export license requirement to be approximately $1.5 billion.”

“This includes an estimated $700 million revenue reduction as a result of the new export license requirement.”

“We also expect full year growth in our semi-custom business, and for our embedded business to return to year-over-year growth in the second half of the year, driven by the reduced inventory levels and improving demand environment.”

“We expect improving demand in the test and measurement, communications, and aerospace markets will drive a return to growth in the second half of 2025.”

“While our semi-custom SoC sales declined year-over-year, console channel inventories have normalized, and demand signals have strengthened for 2025.”

“We passed key milestones in April to begin manufacturing fifth-gen EPYC at TSMC's new Arizona fab, with first production shipments expected in the second half of 2025.”

“Every major cloud provider is deep in development on Turin programs, with a steady stream of public instances and internal deployments expected to ramp into production over the coming quarters.”

“Looking ahead, our MI400 series development remains on track to launch next year.”

“Venice silicon is in our labs and performing well, with bring-up and validation progressing to plan to support a 2026 launch.”

“So I don't think that dramatically changes the TAM.”

“Absolutely. But yes, of course. It would be hard to grow strong double digits otherwise, right?”

“Looking ahead, we will build on the momentum to drive double-digit percentage revenue growth and further accelerated earnings in 2025 and beyond.”

“We believe we gained adaptive computing share in 2024 and are well-positioned for ongoing share gains based on our design win momentum.”

“Based on the breadth of our leadership client CPU portfolio and strong design win momentum, we believe we can grow client segment revenue well ahead of the market.”

“So let me say, as we look into 2025, I think we see a good server market between cloud and enterprise. I think as we went into sort of the early part of '24, there was a little bit of, let's call it, less investments on the CPU side as people were optimizing investments for AI. We saw that sort of pick up in the second half of the year in '24, and we would expect that to go into '25.”

“We would expect the client business and the embedded business to be down more than that. Just given where seasonality is for those businesses. And then we would expect gaming business will be down a little less than that.”

“non-GAAP other net income to be $24 million, non-GAAP effective tax rate to be 13% and the diluted share count is expected to be approximately 1.64 billion shares.”

“More than offsetting a significant decline in our gaming business and a modest decline in our embedded business.”

“Looking forward, we believe channel inventories have now normalized and semi-custom sales will return to more historical patterns in 2025.”

“The initial wave of Ryzen-powered Dell commercial notebooks is planned to launch this spring with the full portfolio ramping in the second half of the year, as we focus on growing commercial PC share.”

“Instinct platforms are currently being deployed across more than a dozen CSPs globally, and we expect this number to grow in 2025.”

“Without guiding for a specific number in 2025, one of the comments that we made is we see this business growing to tens of billions, as we go through the next couple of years.”

“We are seeing strong customer interest in the MI400 series for large-scale training and inference deployments and remain on track to launch in 2026.”

“But it is going to be a little bit dependent on just when deployments happen. But that's kind of currently what we see.”

“I think MI325 is a great product. It's going to compete very well with H200 and the MI350 series will compete very well with Blackwell.”

“But I think overall, we feel good about the trajectory into 2025.”

“Looking ahead, we are very well positioned to deliver another record quarter of revenue in the fourth quarter, driven by continued momentum in our data center and client segments.”

“We are on track to launch our next-gen Ryzen 9,000 X3D processors in November with leadership gaming performance.”

“As a result, we now expect Data Center GPU revenue to exceed $5 billion in 2024, up from $4.5 billion we guided in July and our expectation of $2 billion when we started the year.”

“And then in terms of the Embedded business going to 2025, I would say that the trends that we see are similar to what I mentioned for the Q3, Q4 timing. We do expect that we're -- some of the markets will recover, we're expecting that it will be a gradual recovery.”

“Back to your first question in terms of the mix in Q4. We would expect the majority of the mix will still be on MI300. MI325 is going into production late in the quarter, and it will be more of a first quarter ramp.”

“As we go forward into the fourth quarter, I think we are expecting another quarter of growth on a sequential basis for our Server business and strength in both Enterprise and Cloud.”

“I think we'll see both units up and the ASPs will depend a little bit on the mix between Consumer and Enterprise and Desktop and Notebooks.”

“And so, as we -- let's call it fast forward a year, I would say we would have a fairly balanced portfolio between training and inference.”

“What I would say about 2025 is we feel very good about the growth opportunities I would say that it might be lumpy.”

“I would expect there will be seasonality going into the first half. That's typical in our business.”

“We expect some modest improvement in Q4.”

“Client segment, we also expect to perform well. I think we've done very well with our launches this year, both on the desktop Zen 5 launches as well as the notebook AI PC launches. So, we expect growth there.”

“Certainly, if you look at the sequential guide, the largest contributor is the Data Center business. And that is now such a large piece of our business, it's over 50% of our business in Q3, and it will continue to grow in Q4.”

“And going into the next few quarters going into 2025, I think we expect that the environment will continue to be tight, but we've also planned for significant growth going into 2025.”

“At the same time, we are also seeing our client business expansion nicely. Client business today is more focused on consumer side, which tend to be below corporate average. That's something headwind we'll deal with.”

“Going to 2025, we're not going to guide specifically. But as you mentioned, the outputs and takes that will help us going forward I would say first is, going forward, the largest growth driver is our Data Center business, both the CPU side, the GPU side, and you are absolutely right, we see our Enterprise Server business continue to expand. That will be a tailwind on gross margin side.”

“And we're also very engaged with a number of large cloud and Enterprise customers that are actively working with us and optimizing their workloads, and we would expect those would be good opportunities for us over the next couple of quarters as well.”

“Non-GAAP other net income to be $17 million, non-GAAP effective tax rate to be 13% and the diluted share count is expected to be approximately 1.64 billion shares.”

“Non-GAAP operating expenses to be approximately $2.05 billion.”

“We expect revenue to be approximately $7.5 billion, plus or minus $300 million, up 22% year-over-year, driven by strong growth in our Data Center and Client segment, more than offset decline in the Gaming and Embedded segments.”

“Design win momentum is very strong across our portfolio, tracking to grow more than 20% year-over-year in 2024 and positioning us well to grow our embedded business faster than the overall market in the coming years.”

“HP and Lenovo are on track to more than triple the number of Ryzen AI Pro platforms they offer in 2024, and we expect to have more than 100 Ryzen AI Pro commercial platforms in market next year, positioning us well for share gains as businesses refresh the hundreds of millions of Windows 10 PCs that will no longer receive Microsoft technical support starting in 2025.”

“Production shipments are planned to start this quarter with widespread system availability from Dell, HP, Lenovo, Super Micro and others starting in the first quarter of 2025.”

“Development on our MI400 series based on the CDNA Next architecture is also progressing very well towards a 2026 launch.”

“On the gross margin side, once we continue to ramp the revenue, we do think we'll have the opportunity to continue to improve gross margin.”

“And then the other segments on a sequential basis, Gaming, Embedded would be more modest.”

“We feel pretty good about the overall Data Center business to continue to be absolutely the driver of gross margin expansion.”

“As far as MI300, we are quite confident over the long-term, it will be accretive to our corporate average.”

“Over time, in the longer term, we do believe gross margin will be accretive to corporate average.”

“We continue to see line of sight to continue increasing supply as we go through the second half of the year.”

“Secondly, I’d say, Embedded business, we are going to see Embedded business to be up sequentially each quarter.”

“When you look at the second half we will continue to see Data Center to be the major driver of our top-line revenue growth, will help with the margin expansion.”

“I do expect that we'll continue to ramp training over time.”

“And then into 2025, you're going to see AI PCs across sort of a larger set of price points which will also open up more opportunities.”

“As we go into the second half of the year, I think we have better seasonality in general, and we think we can do, let us call it above-typical seasonality, given the strength of our product launches and when we are launching.”

“325 will start in the fourth quarter and then ramp more in the first half of next year.”

“So overall, I think the server market and our ability to continue to grow share in the server market is one of the things that we see in the second half of the year.”

“And then in addition to that, we are in the process of launching Turin. So we started production here in the second quarter and we are on track to launch broadly in the second half of the year. We'll see some revenue of Turin in the second half of the year contributing as well.”

“Going into the second half of the year, I think we also feel good about it. There are a couple of positives there. We see -- first of all the market looks like it's improving, so we have seen some return to spending in both enterprise and cloud.”

“As we look into the second half of the year I think we would expect that MI300 revenue would continue to ramp in the third quarter and the fourth quarter.”

“Also during the third quarter, we expect to close the acquisition of Silo AI for approximately $665 million in cash.”

“And the diluted share count is expected to be approximately 1.64 billion shares.”

“Non-GAAP effective tax rate to be 13%.”

“In summary, we delivered strong second quarter results and are well positioned to grow revenue significantly in the second half of the year, driven by our data center and client segments.”

“Although second quarter revenue was flattish sequentially, we saw early signs of order patterns improving and expect embedded revenue to gradually recover in the second half of the year.”

“Semi-custom demand remains soft, as we are now in the fifth-year of the console cycle and we expect sales to be lower in the second half of the year compared to the first half.”

“More than 100 Ryzen AI 300 series premium, gaming, and commercial platforms are on track to launch from Acer, ASUS, HP, Lenovo, and others over the coming quarters.”

“We expect broad OEM and cloud availability later this year.”

“We now expect data center GPU revenue to exceed $4.5 billion in 2024, up from the $4 billion we guided in April.”

“And our MI400 series powered by the CDNA “Next” architecture is making great progress in development and is scheduled to launch in 2026.”

“From a full year standpoint, our $4 billion number is not supply capped -- I'm sorry, yes, it's not supply capped. It is -- we do have supply capability above that. It is more back half weighted.”

“So as we've upped our guidance from $3.5 billion to $4 billion, we still -- we have supply visibility significantly beyond that.”

“I see as we bring in additional products later this year into 2025, that, that will continue to be a strong spot for us.”

“In summary, we executed well in the first quarter, setting us up to deliver strong annual revenue growth and expanded gross margin, driven by growing adoption of our Instinct, EPYC and Ryzen product portfolios.”

“When we look at our server CPU sort of ASPs, they're actually very stable... Overall, I would say, the pricing environment is stable.”

“On the gross margin side, going back to your question, we said in the past, and we continue to believe the case is, Data Center GPU gross margin over time will be accretive to corporate average. But it will take a while to get to the Server level for gross margin.”

“Yes, yes, you're right. Gaming is down similar zip code like Q1.”

“Based on the visibility we have, the first half, both Q1, Q2, we guided down sequentially more than 30%. We actually think the second half will be lower than first half.”

“You always ask a math question. So I think, in general, it is more. The Data Center GPU ramp, it will be more than the overall company's $200-some million ramp.”

“We expect Turin to give us access to a broader set of workloads. So our SAM actually expands with Turin, both in enterprise and cloud. And from our experience, I think you'll see a faster transition than, for example, when we went from Milan to Genoa.”

“We do think over time, the gross margin should be accretive to corporate average.”

“Yes. I mean, I think, Tim, I think the best way to say it is our Data Center segment is on a very, very strong ramp as we go through the back half of the year. Server CPUs, certainly, Data Center GPUs, for sure. So I don't know that we're going to get into specifics, but I could say, in general, you should expect overall at the segment level to be very strong double digits.”

“The Data Center will continue to ramp in second half. I think that will continue to be the major driver of gross margin expansion in second half.”

“So if you're looking at sort of the near term, I would say, for example, in the second quarter, we do have more demand than we have supply right now, and we're continuing to work on pulling in some of that supply.”

“So I think, overall, we see it as a continued good progression for us with the server business going through 2024 and beyond.”

“From a demand standpoint, we continue to build backlog as well as build engagements going forward. And similarly, on the supply standpoint, we're continuing to build supply momentum.”

“And then as we go into 2025, you would see it more across the rest of the portfolio.”

“And as we go into the second half of the year, to your question about units versus ASPs, I think we expect some increase in units as well as ASPs.”

“In the second quarter, we expect overall Data Center to be up strong double digits. And then within that, we expect server to be up as well.”

“I think Q2 will be another significant ramp. And we're going to ramp supply every quarter this year.”

“Non-GAAP effective tax rate to be 13% and the diluted share count is expected to be approximately 1.64 billion shares.”

“Year-over-year, we expect our Data Center and Client segment revenue to be up significantly, driven by the strength of our product portfolio; the Embedded and the Gaming segment revenue to decline by a significant double-digit percentage.”

“Given the current embedded market conditions, we're now expecting second quarter embedded segment revenue to be flat sequentially, with a gradual recovery in the second half of the year.”

“We're excited about the growth opportunities for the PC market. And based on the strength of our Ryzen CPU portfolio, we expect to grow revenue share this year.”

“MI300 demand continues to strengthen. And based on our expanding customer engagements, we now expect data center GPU revenue to exceed $4 billion in 2024, up from the $3.5 billion we guided in January.”

“Turin remains on track to launch later this year.”

“I don't think it's a pull-forward of demand... So, it's actually gone a bit better, then our original forecast. And as a result, we've seen stronger demand signals and customers are gaining confidence in their ability to deploy a significant number of MI300 this year.”

“So we think for both training and inference, we will continue to be very competitive.”

“So, even in a mixed demand environment, I think we're bullish on what traditional server CPUs can do in 2024.”

“we do see that refresh cycle happening as we get into 2024.”

“I think we expect the CPU business from a market standpoint to grow, Ross. As we go into 2024, I think the rate and pace of growth will depend a little bit on the macro and just overall CapEx trends.”

“So, yes, it should increase each quarter, but be a bit more second half weighted.”

“So, first on the MI300 trajectory. I think you would expect that revenue should increase every quarter from now through sort of the end of the year, but it will be a bit more second half weighted”

“Think about it as first half capacity is tight and more comes on in the second half of the year, but we've certainly made more progress there.”

“We expect to expand gross margin in 2024 and continue to invest to address the large AI opportunities while driving operating model leverage to deliver earnings per share growth faster than top line revenue growth.”

“Embedded segment revenue to decline and the Gaming segment revenue to decline by significant double-digit percentage.”

“Non-GAAP effective tax rate to be 13% and the diluted share count is expected to be approximately 1.63 billion shares.”

“Looking at 2024, we expect overall embedded demand will remain soft through the first half of the year as customers continue to focus on normalizing their inventory levels.”

“Going forward, we now expect annual revenue to decline by a significant double-digit percentage year-over-year as supply caught up with demand in 2023, and we entered the fifth year of what has been a very strong console cycle.”

“We continue to see strong growth opportunities for our client business as we ramp our current products, extend our AIPC leadership and launch our next wave of Zen 5 CPUs.”

“We are aggressively driving our Ryzen AI CPU roadmap to extend our AI leadership, including our next-gen Strix processors that are expected to deliver more than three times the AI performance of our Ryzen 7040 series processors.”

“Acer, ASUS, HP, Lenovo, MSI and other large PC OEMs will all offer notebooks powered by our Ryzen 8000 series processors with the first systems expected to go on sale in February.”

“We have also made significant progress with our supply chain partners and have secured additional capacity to support upside demand.”

“we shipped the majority of AMD Instinct MI300A accelerators for the El Capitan supercomputer in the fourth quarter and expect to complete shipments this quarter for what is expected to be the world's fastest supercomputer when it comes online later this year.”

“For Enterprise customers, HPE, Dell, Lenovo, Supermicro and other server vendors are on track to launch differentiated MI300 platforms later this quarter with strong demand from multiple enterprise customers.”

“positioning us well for continued growth, based on expanded production deployments planned for 2024.”

“We expect this number to grow in 2024 based on the leadership performance, efficiency and features of our EPYC CPU portfolio.”

“So, I think as we look at all those pieces, I think we feel good that the growth rate is going to be significant and sustained over the next few years.”

“I think we expect units to grow sort of substantial double-digit percentage.”

“Exiting Q4 2024, is it possible to get to $1.5 billion? It is possible, right, because Lisa mentioned earlier, we'll see sequential increase in each quarter and more back-end loaded in second-half and we do have a supplies more than $3.5 billion.”

“I think what we've seen is the adoption rate of our AI solutions has given us confidence in not just the Q4 revenue number but also sort of the progression as we go through 2024.”

“we are on track to begin production shipments of Instinct MI300x GPU accelerators to lead cloud and OEM customers in the coming weeks.”

“And then Gaming, from a console standpoint, we do expect that to be down a bit more than that.”

“Embedded, think about it down similar levels sort of in the teens compared to sort of Q3 was down in the teens and Q4 will be down in the teens.”

“I think going forward, it's really mix, primarily mix is driving our gross margin, but we feel pretty good about second half next year when we can expand the Data Center significantly and especially, Embedded segment start to recover, we should be able to drive more meaningful gross margin improvement in second half.”

“I think going forward, the pace of Client segment improvement will moderate, but it will continue to drive incremental gross margin improvement in Client segment.”

“So we have to get through sort of the next couple of quarters of inventory correction, and then we believe we'll return to growth in the second half of the year.”

“So I do think there is the framework that unit growth may be more modest, but ASP growth, given the core count and the compute capability will contribute to overall growth.”

“And then we have the headwinds of Embedded in the inventory correction that we'll go through in the first half and the console cycle.”

“When we look at the various pluses and minuses, I think we feel very good about the Data Center business. It continues to be a strong growth driver for us as we think about 2024 for both server as well as our MI300 clients as well, we think incrementally improves from a market standpoint as well as we believe we can gain share, given the strength of our product portfolio.”

“But typically, it takes a few quarters to ramp the gross margin to a normalized level.”

“So I think for the second half, we said we expect Data Center business to grow approximately 50% versus first half. But right now based on what we are seeing, we continue to see in that similar range of that 50%.”

“And that will be mostly AI so with a very small piece being HPC. And as we go through 2024, we would expect revenue to continue to ramp quarterly, and again, it will be mostly AI.”

“And then as we go into the first quarter, we actually expect revenue to be approximately similar in that $400 million range.”

“In the fourth quarter, we expect to benefit from strong Data Center and Client momentum, driven by MI300 AI accelerated ramp and the strength of our high performance leadership Zen 4 family of products despite lower sales in the Gaming segment and additional softening of demand in the embedded market.”

“We expect non-GAAP gross margin to be approximately 51.5%, non-GAAP operating expenses to be approximately $1.74 billion, non-GAAP effective tax rate to be 13% and the diluted share count is expected to be approximately 1.63 billion shares.”

“Sequentially, we expect Data Center segment to grow by strong double-digit percentage, Client segment revenue to increase and the Gaming and Embedded segment to decline by double-digit percentage.”

“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 market.”

“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.”

“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.”

“As the PC market returns to seasonal patterns, we believe we are well positioned to gain profitable share in the premium and commercial portions of the market based on the strength of our product offerings.”

“Looking at the next couple of quarters, we expect strong growth in our Data Center business, driven by both EPYC and Instinct processors.”

“Over the medium term, we see strong growth opportunities for our Embedded business based on our significant design win traction and our broad and differentiated portfolio of embedded FPGAs, CPUs, GPUs and adaptive SoCs that can address a larger portion of our customers' compute needs.”

“we now expect Data Center GPU revenue to be approximately $400 million in the fourth quarter and exceed $2 billion in 2024 as revenue ramps throughout the year.”

“We feel that we have ample supply for an aggressive ramp in the fourth quarter and into 2024.”

“we would expect that our AI business will be accretive to gross margins at the corporate level.”

“So, in the longer term, you should expect us from days of inventory be more around 100 to 120 days versus traditionally like 80 days or 75 days.”

“I think as we ramp those product lines in Q3 and Q4, you will see inventory come down first in Q3 and Q4 again. I think the inventory days of inventory probably will be around 110 to 120 days.”

“As Jean would say, we're not guiding for the fourth quarter, but I think you should expect embedded sort of in that similar zip code.”

“So, going to Q4, again we're not guiding Q4 and it's going to depend on mix. I would say one thing is you will have a similar dynamics, right. Datacenters expect to grow very significantly. At the same time, we're going to have the same headwind from embedded business declining sequentially. So, overall, we do expect gross margin to improve from this level going forward.”

“our expectation is that, as Jean said, the datacenter business, given all of the market dynamics, we see it up high single-digits year-on-year, we see much better second-half compared to first-half.”

“We do believe that we're on a path to continue to grow into the second-half of the year, and beyond.”

“As we go into the fourth quarter, there is an implied significant ramp in revenue.”

“So, overall on balance, we think year-over-year it's probably more like a high single-digit. It's really strong ramp, not only in Q3, right, sequentially earnings double-digit -- strong double-digit. And the Q4, of course we're going to see continued sequential strong ramp.”

“we are expecting a large ramp in second-half for our Datacenter business, and weighted towards the fourth quarter. And we are still looking at a zip code of, let's call it, 50% plus or minus second-half to first-half.”

“Year-over-year, we expect revenue for the Client segment to be up, Datacenter segment to be flattish, and the gaming and Embedded segments to decline.”

“We expect the Client segment to return to profitability in the third quarter.”

“We expect inventory to decline as we ship this product to customers in the second-half of the year.”

“Against this backdrop, we expect strong growth driven by higher fourth gen EPYC and Ryzen 7000 processor sales and initial shipments of our Instinct MI300 accelerators in the fourth quarter.”