Why is AMD providing non-GAAP financial measures?

AMD provides non-GAAP financial measures because the company believes they offer investors a clearer view of its core operating performance. These measures exclude certain items that are not considered indicative of ongoing operations, such as amortization of acquired intangibles, restructuring charges, and specific one-time charges or settlements, thereby facilitating easier comparison of current and historical results.

What were some of the significant non-GAAP adjustments made in the 2013 fiscal year?

For fiscal year 2013, significant non-GAAP adjustments included the exclusion of amortization of acquired intangible assets, net restructuring and other special charges (gains), and net legal settlements. Notably, the company received $48 million in net cash from patent-related legal settlements during the fourth quarter of 2013, which was excluded from non-GAAP operating and net income calculations for the period and the full year.

What are 'Adjusted EBITDA' and 'non-GAAP free cash flow'?

Adjusted EBITDA is presented as a supplemental performance measure by adjusting operating income (loss) for depreciation, amortization, employee stock-based compensation, and other specific items relevant to the period. Non-GAAP free cash flow is calculated by adjusting GAAP net cash provided by (used in) operating activities for capital expenditures. AMD's management believes these metrics are important for investors to understand the company's performance and cash flow generation.

AMD 8-K: Earnings & Results & Regulation FD

Q: What is the main purpose of this 8-K filing?

The main purpose of this 8-K filing is to announce Advanced Micro Devices, Inc.'s (AMD) financial results for the fourth fiscal quarter and the full fiscal year ended December 28, 2013. It also serves to provide additional context and financial commentary from the Chief Financial Officer.

Summary

This 8-K filing by Advanced Micro Devices, Inc. (AMD) on January 21, 2014, primarily serves to announce the company's financial results for the fourth fiscal quarter and the full fiscal year ended December 28, 2013. The report details the company's financial position and operational performance, with a significant focus on providing non-GAAP financial measures alongside standard GAAP reporting. These non-GAAP measures, including gross margin, operating expenses, net income, and earnings per share, are presented to offer investors a clearer view of core operating performance by excluding items such as amortization of acquired intangibles, restructuring charges, legal settlements, and specific charges related to its foundry partner, GLOBALFOUNDRIES (GF). Investors should pay close attention to the explanations for the adjustments made to GAAP figures, as these relate to significant past events and strategic decisions. The company emphasizes that these non-GAAP metrics are intended to facilitate easier comparison of current and historical results and to provide a more consistent basis for evaluating performance, excluding one-time or non-recurring items. The filing also includes information on Adjusted EBITDA and non-GAAP free cash flow as supplemental performance indicators.

Key Highlights

1AMD announced its financial results for Q4 and the full fiscal year 2013, ending December 28, 2013.
2The company is providing both GAAP and non-GAAP financial measures to aid investor understanding of core operating performance.
3Key non-GAAP adjustments include amortization of acquired intangibles, restructuring charges, and net legal settlements.
4Significant one-time charges related to GLOBALFOUNDRIES (GF) agreements (LCM Charge, Exclusivity Waiver) are also detailed and excluded in non-GAAP calculations for prior periods.
5The filing provides commentary on fiscal 2013 performance, including a $48 million net cash inflow from patent-related legal settlements.
6AMD also presents Adjusted EBITDA and non-GAAP free cash flow as supplemental performance metrics.
7The report references attached exhibits (Exhibit 99.1 and 99.2) containing the full press release and financial commentary from the CFO.

ADVANCED MICRO DEVICES INC 8-K Report, Financial Results (Jan 21, 2014)

Summary

Key Highlights

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