Q4-16 | Q3-16 | Q4-15 | 2016 | 2015 | ||||||
Revenue | $1.11B | $1.31B | $958M | $4.27B | $3.99B | |||||
Operating loss | $(3)M | $(293)M | $(49)M | $(372)M | $(481)M | |||||
Net loss | $(51)M | $(406)M | $(102)M | $(497)M | $(660)M | |||||
Loss per share | $(0.06) | $(0.50) | $(0.13) | $(0.60) | $(0.84) |
Q4-16 | Q3-16 | Q4-15 | 2016 | 2015 | ||||||
Revenue | $1.11B | $1.31B | $958M | $4.27B | $3.99B | |||||
Operating income (loss) | $26M | $70M | $(39)M | $44M | $(253)M | |||||
Net income (loss) | $(8)M | $27M | $(79)M | $(117)M | $(419)M | |||||
Earnings (loss) per share | $(0.01) | $0.03 | $(0.10) | $(0.14) | $(0.54) |
◦ | Q4 2016 was a 14-week fiscal quarter compared to 13-week fiscal quarters for Q3 2016 and Q4 2015. |
◦ | Revenue of $1.11 billion was up 15 percent year-over-year, primarily due to higher GPU sales. Revenue was down 15 percent sequentially, primarily driven by seasonally lower sales of semi-custom SoCs. |
◦ | On a GAAP basis, gross margin was 32 percent, up 2 percentage points year-over-year and up 27 percentage points sequentially as Q3 2016 gross margin was negatively impacted by a $340 million charge (WSA charge) related to the sixth amendment of the wafer supply agreement with GLOBALFOUNDRIES. Operating loss was $3 million compared to an operating loss of $49 million a year ago and an operating loss of $293 million in the prior quarter. The year-over-year improvement was primarily due to higher revenue and IP monetization licensing gain while the sequential improvement is primarily due to the absence of the WSA charge offset by lower fourth quarter revenue. Net loss was $51 million compared to a net loss of $102 million a year ago and net loss of $406 million in the prior quarter. Loss per share was $0.06 compared to a loss per share of $0.13 a year ago and loss per share of $0.50 in the prior quarter. |
◦ | On a non-GAAP(1) basis, gross margin was 32 percent, up 2 percentage points year-over-year and up 1 percentage point sequentially primarily due to higher Computing and Graphics segment revenue. Operating income was $26 million compared to an operating loss of $39 million a year ago and operating income of $70 million in the prior quarter. Operating income was lower in the current quarter due to lower revenue. Net loss was $8 million compared to net loss of $79 million a year ago and net income of $27 million in the prior quarter. Loss per share was $0.01 compared to a loss per share of $0.10 a year ago and earnings per share of $0.03 in the prior quarter. |
◦ | Cash and cash equivalents were $1.26 billion at the end of the quarter, up $6 million from the end of the prior quarter. |
◦ | Revenue of $4.27 billion, up 7 percent on an annual basis, increased in both reportable segments. |
◦ | On a GAAP basis, gross margin was 23 percent, down 4 percentage points from the prior year primarily due to the WSA charge. Operating loss was $372 million compared to an operating loss of $481 million in the prior year. Operating loss improvement was due to higher revenue, lower restructuring charges, and an IP monetization licensing gain, offset by the WSA charge. Net loss was $497 million compared to a net loss of $660 million in the prior year. Loss per share was $0.60 compared to a loss per share of $0.84 in 2015. |
◦ | On a non-GAAP(1) basis, gross margin was 31 percent, up 3 percentage points year-over-year primarily due to improved product mix and an inventory write-down recorded in Q3 2015. Operating income was $44 million compared to an operating loss of $253 million in the prior year. Operating income improvement was primarily related to higher revenue and the IP monetization licensing gain. Net loss was $117 million compared to a net loss of $419 million in the prior year. Loss per share was $0.14 compared to a loss per share of $0.54 in 2015. |
◦ | Cash and cash equivalents were $1.26 billion at the end of the year, up from $785 million at the end of the prior year. |
• | Computing and Graphics segment revenue was $600 million, up 28 percent year-over-year and 27 percent sequentially. The year-over-year increase was primarily driven by higher GPU sales. The sequential increase was primarily due to higher GPU and client processor sales. |
◦ | Operating loss was $21 million, compared to an operating loss of $99 million in Q4 2015 and an operating loss of $66 million in Q3 2016. The year-over-year and sequential improvements were driven primarily by higher revenue. |
◦ | Client average selling price (ASP) was down year-over-year driven by desktop processors, and down sequentially driven by desktop and mobile processors. |
◦ | GPU ASP increased year-over-year due to higher desktop and professional graphics ASPs. GPU ASP increased sequentially due to higher mobile and professional graphics ASPs. |
• | Enterprise, Embedded and Semi-Custom segment revenue was $506 million, up 4 percent year-over-year primarily driven by higher embedded and semi-custom SoC revenue. Sequentially, revenue decreased 39 percent due to seasonally lower sales of semi-custom SoCs. |
◦ | Operating income was $47 million compared to $59 million in Q4 2015 and $136 million in Q3 2016. The year-over-year decrease was primarily driven by higher R&D investments in Q4 2016, partially offset by an IP monetization licensing gain. The sequential decrease was primarily due to seasonally lower sales of semi-custom SoCs. |
• | All Other operating loss was $29 million compared with an operating loss of $9 million in Q4 2015 and an operating loss of $363 million in Q3 2016. The year-over-year operating loss increase was primarily related to higher stock-based compensation charges in Q4 2016. The sequential improvement was primarily due to the absence of the WSA charge. |
• | AMD disclosed new details on its upcoming CPU and GPU architectures and offerings: |
◦ | AMD delivered new details on the architecture, go-to-market plans, and performance of upcoming “Zen”-based processors: |
• | Revealed Ryzen™, the brand that will span “Zen”-based desktop (codenamed “Summit Ridge”) and notebook (codenamed “Raven Ridge”) products. |
• | Introduced AMD SenseMI technology, a set of sensing, adapting, and learning features built into AMD Ryzen™ processors. AMD SenseMI technology is a key enabler of AMD's landmark generational increase of greater than 40 percent in instructions per clock with its “Zen” core architecture. |
• | Delivered a first look at the impressive gaming capabilities of an AMD Ryzen™ CPU and Vega GPU-based desktop system running Star Wars©: Battlefront™ - Rogue One in 4K at more than 60 frames per second. |
• | Showcased ecosystem readiness and the breadth of partner support for forthcoming Ryzen™ desktop processors with new AM4 motherboards and ‘Dream PCs’ from global system integrators (SIs), as well as upcoming third-party AM4 thermal solutions. |
◦ | AMD introduced preliminary details of its forthcoming Vega GPU architecture designed to address the most data- and visually-intensive next-generation workloads. Key architecture advancements include a differentiated memory subsystem, next-generation geometry pipeline, new compute engine, and a new pixel engine. GPU products based on the Vega architecture are expected to ship in the second quarter of 2017. |
• | AMD announced a new collaboration with Google, making Radeon™ GPU technology available to Google Cloud Platform users worldwide starting in 2017 to help accelerate Google Compute Engine and Google Cloud Machine Learning services. |
• | To accelerate the machine intelligence era in server computing, AMD unveiled the Radeon™ Instinct initiative, a new suite of GPU hardware and open-source software offerings designed to dramatically increase performance, efficiency, and ease of implementation of deep learning and high-performance compute (HPC) workloads. Radeon™ Instinct products are expected to ship in 1H 2017. |
• | AMD introduced several new products and technologies in the quarter, including: |
◦ | New 7th Generation AMD PRO Processor-based commercial desktops and notebooks from Lenovo. |
◦ | Radeon™ Pro WX Series of professional graphics cards based on the Polaris architecture, featuring fourth-generation Graphics Core Next (GCN) technology, and engineered on the 14nm FinFET process. |
◦ | A new family of power-efficient graphics processors, the Radeon™ Pro 400 Series, first available in the all-new 15-inch Apple MacBook Pro. |
◦ | Radeon FreeSync™ 2 technology, the next major milestone in delivering smooth gameplay and advanced pixel integrity to gamers, with planned availability to consumers in 1H 2017, adding to the 100+ FreeSync™ monitors already available today. |
◦ | Radeon™ Pro Software Enterprise, Radeon Software Crimson ReLive Edition, and updates to the Radeon Open Compute Platform (ROCm) software solutions. |
(Millions except percentages) | Q4-16 | Q3-16 | Q4-15 | 2016 | 2015 | |||||||||||||||
GAAP Gross Margin | $ | 351 | $ | 59 | $ | 283 | $ | 998 | $ | 1,080 | ||||||||||
GAAP Gross Margin % | 32 | % | 5 | % | 30 | % | 23 | % | 27 | % | ||||||||||
Technology node transition charge | — | — | — | — | 33 | |||||||||||||||
Stock-based compensation | 1 | — | 1 | 2 | 3 | |||||||||||||||
Charge related to the sixth amendment to the WSA with GF | — | 340 | — | 340 | — | |||||||||||||||
Non-GAAP Gross Margin | $ | 352 | $ | 399 | $ | 284 | $ | 1,340 | $ | 1,116 | ||||||||||
Non-GAAP Gross Margin % | 32 | % | 31 | % | 30 | % | 31 | % | 28 | % |
(Millions) | Q4-16 | Q3-16 | Q4-15 | 2016 | 2015 | |||||||||||||||
GAAP operating loss | $ | (3 | ) | $ | (293 | ) | $ | (49 | ) | $ | (372 | ) | $ | (481 | ) | |||||
Charge related to the sixth amendment to the WSA with GF | — | 340 | — | 340 | — | |||||||||||||||
Technology node transition charge | — | — | — | — | 33 | |||||||||||||||
Restructuring and other special charges, net | — | — | (6 | ) | (10 | ) | 129 | |||||||||||||
Amortization of acquired intangible assets | — | — | — | — | 3 | |||||||||||||||
Stock-based compensation | 29 | 23 | 16 | 86 | 63 | |||||||||||||||
Non-GAAP operating income (loss) | $ | 26 | $ | 70 | $ | (39 | ) | $ | 44 | $ | (253 | ) |
(Millions except per share amounts) | Q4-16 | Q3-16 | Q4-15 | 2016 | 2015 | |||||||||||||||||||||||||||||||||||
GAAP net loss /loss per share | $ | (51 | ) | $ | (0.06 | ) | $ | (406 | ) | $ | (0.50 | ) | $ | (102 | ) | $ | (0.13 | ) | $ | (497 | ) | $ | (0.60 | ) | $ | (660 | ) | $ | (0.84 | ) | ||||||||||
Charge related to the sixth amendment to the WSA with GF | — | — | 340 | 0.39 | — | — | 340 | 0.41 | — | — | ||||||||||||||||||||||||||||||
Technology node transition charge | — | — | — | — | — | — | — | — | 33 | 0.04 | ||||||||||||||||||||||||||||||
Restructuring and other special charges, net | — | — | — | — | (6 | ) | (0.01 | ) | (10 | ) | (0.01 | ) | 129 | 0.16 | ||||||||||||||||||||||||||
Amortization of acquired intangible assets | — | — | — | — | — | — | — | — | 3 | — | ||||||||||||||||||||||||||||||
Stock-based compensation | 29 | 0.03 | 23 | 0.03 | 16 | 0.02 | 86 | 0.10 | 63 | 0.08 | ||||||||||||||||||||||||||||||
Loss on debt redemption | 7 | 0.01 | 61 | 0.07 | — | — | 68 | 0.08 | — | — | ||||||||||||||||||||||||||||||
Non-cash interest expense related to convertible debt | 5 | 0.01 | 1 | — | — | — | 6 | 0.01 | — | — | ||||||||||||||||||||||||||||||
Gain on sale of 85% of ATMP JV | — | — | 4 | — | — | — | (146 | ) | (0.17 | ) | — | — | ||||||||||||||||||||||||||||
Tax provision (benefit) related to sale of 85% of ATMP JV | — | — | (1 | ) | — | — | — | 26 | 0.03 | — | — | |||||||||||||||||||||||||||||
Tax settlement in foreign jurisdiction | — | — | — | — | 13 | 0.02 | — | — | 13 | 0.02 | ||||||||||||||||||||||||||||||
Equity in income (loss) of ATMP JV | 2 | — | 5 | 0.01 | — | — | 10 | 0.01 | — | — | ||||||||||||||||||||||||||||||
Non-GAAP net income (loss) / earnings (loss) per share | $ | (8 | ) | $ | (0.01 | ) | $ | 27 | $ | 0.03 | $ | (79 | ) | $ | (0.10 | ) | $ | (117 | ) | $ | (0.14 | ) | $ | (419 | ) | $ | (0.54 | ) |
1. | In this earnings press release, in addition to GAAP financial results, AMD has provided non-GAAP financial measures including non-GAAP gross margin, non-GAAP operating income (loss), non-GAAP net income (loss) and non-GAAP earnings (loss) per share. These non-GAAP financial measures reflect certain adjustments as presented in the tables in this earnings press release. AMD also provided adjusted EBITDA and non-GAAP free cash flow as supplemental measures of its performance. These items are defined in the footnotes to the selected corporate data tables provided at the end of this earnings press release. AMD is providing these financial measures because it believes this non-GAAP presentation makes it easier for investors to compare its operating results for current and historical periods and also because AMD believes it assists investors in comparing AMD’s performance across reporting periods on a consistent basis by excluding items that it does not believe are indicative of its core operating performance and for the other reasons described in the footnotes to the selected data tables. Refer to the data tables at the end of this earnings press release. |
Three Months Ended | Year Ended | |||||||||||||||||||
December 31, 2016 | September 24, 2016 | December 26, 2015 | December 31, 2016 | December 26, 2015 | ||||||||||||||||
Net revenue | $ | 1,106 | $ | 1,307 | $ | 958 | $ | 4,272 | $ | 3,991 | ||||||||||
Cost of sales | 755 | 1,248 | 675 | $ | 3,274 | $ | 2,911 | |||||||||||||
Gross margin | 351 | 59 | 283 | 998 | 1,080 | |||||||||||||||
Gross margin % | 32 | % | 5 | % | 30 | % | 23 | % | 27 | % | ||||||||||
Research and development | 264 | 259 | 229 | 1,008 | 947 | |||||||||||||||
Marketing, general and administrative | 121 | 117 | 109 | 460 | 482 | |||||||||||||||
Amortization of acquired intangible assets | — | — | — | — | 3 | |||||||||||||||
Restructuring and other special charges, net | — | — | (6 | ) | (10 | ) | 129 | |||||||||||||
Licensing gain | (31 | ) | (24 | ) | — | (88 | ) | — | ||||||||||||
Operating loss | (3 | ) | (293 | ) | (49 | ) | (372 | ) | (481 | ) | ||||||||||
Interest expense | (34 | ) | (41 | ) | (41 | ) | (156 | ) | (160 | ) | ||||||||||
Other income (expense), net | (7 | ) | (63 | ) | (2 | ) | 80 | (5 | ) | |||||||||||
Loss before income taxes | $ | (44 | ) | $ | (397 | ) | $ | (92 | ) | $ | (448 | ) | $ | (646 | ) | |||||
Provision for income taxes | 5 | 4 | 10 | 39 | 14 | |||||||||||||||
Equity in income (loss) of ATMP JV | (2 | ) | (5 | ) | — | (10 | ) | — | ||||||||||||
Net loss | $ | (51 | ) | $ | (406 | ) | $ | (102 | ) | $ | (497 | ) | $ | (660 | ) | |||||
Net loss per share | ||||||||||||||||||||
Basic | $ | (0.06 | ) | $ | (0.50 | ) | $ | (0.13 | ) | $ | (0.60 | ) | $ | (0.84 | ) | |||||
Diluted | $ | (0.06 | ) | $ | (0.50 | ) | $ | (0.13 | ) | $ | (0.60 | ) | $ | (0.84 | ) | |||||
Shares used in per share calculation | ||||||||||||||||||||
Basic | 931 | 815 | 791 | 835 | 783 | |||||||||||||||
Diluted | 931 | 815 | 791 | 835 | 783 | |||||||||||||||
ADVANCED MICRO DEVICES, INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Millions) | ||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||
December 31, 2016 | September 24, 2016 | December 26, 2015 | December 31, 2016 | December 26, 2015 | ||||||||||||||||
Total comprehensive loss | $ | (53 | ) | $ | (406 | ) | $ | (95 | ) | $ | (494 | ) | $ | (663 | ) |
December 31, 2016 | September 24, 2016 | December 26, 2015 | ||||||||||
Assets | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | $ | 1,264 | $ | 1,258 | $ | 785 | ||||||
Accounts receivable, net | 311 | 640 | 533 | |||||||||
Inventories, net | 751 | 772 | 678 | |||||||||
Prepayment and other - GLOBALFOUNDRIES | 32 | 13 | 33 | |||||||||
Prepaid expenses | 63 | 63 | 43 | |||||||||
Other current assets | 109 | 78 | 248 | |||||||||
Total current assets | 2,530 | 2,824 | 2,320 | |||||||||
Property, plant and equipment, net | 164 | 161 | 188 | |||||||||
Goodwill | 289 | 289 | 278 | |||||||||
Investment in ATMP JV | 59 | 60 | — | |||||||||
Other assets | 279 | 282 | 298 | |||||||||
Total Assets | $ | 3,321 | $ | 3,616 | $ | 3,084 | ||||||
Liabilities and Stockholders' Equity (Deficit) | ||||||||||||
Current liabilities: | ||||||||||||
Short-term debt | $ | — | $ | — | $ | 230 | ||||||
Accounts payable | 440 | 582 | 279 | |||||||||
Payable to GLOBALFOUNDRIES | 255 | 284 | 245 | |||||||||
Payable to ATMP JV | 128 | 144 | — | |||||||||
Accrued liabilities | 391 | 384 | 472 | |||||||||
Other current liabilities | 69 | 25 | 124 | |||||||||
Deferred income on shipments to distributors | 63 | 54 | 53 | |||||||||
Total current liabilities | 1,346 | 1,473 | 1,403 | |||||||||
Long-term debt, net | 1,435 | 1,632 | 2,007 | |||||||||
Other long-term liabilities | 124 | 126 | 86 | |||||||||
Stockholders' equity (deficit): | ||||||||||||
Capital stock: | ||||||||||||
Common stock, par value | 9 | 9 | 8 | |||||||||
Additional paid-in capital | 8,334 | 8,258 | 7,017 | |||||||||
Treasury stock, at cost | (119 | ) | (127 | ) | (123 | ) | ||||||
Accumulated deficit | (7,803 | ) | (7,752 | ) | (7,306 | ) | ||||||
Accumulated other comprehensive loss | (5 | ) | (3 | ) | (8 | ) | ||||||
Total Stockholders' equity (deficit) | 416 | 385 | (412 | ) | ||||||||
Total Liabilities and Stockholders' Equity (Deficit) | $ | 3,321 | $ | 3,616 | $ | 3,084 |
(1) Amounts reflected adoption of FASB ASU 2015-17, Balance Sheet Classification of Deferred Taxes beginning in the first quarter of 2016. | ||||||
(2) Amounts reflected adoption of FASB ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs beginning in the first quarter of 2016. |
Three Months Ended | Year Ended | |||||||
December 31, 2016 | December 31, 2016 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (51 | ) | $ | (497 | ) | ||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
Net gain on sale of equity interests in ATMP JV | — | (146 | ) | |||||
Equity in loss of ATMP JV | 1 | 2 | ||||||
Depreciation and amortization | 34 | 133 | ||||||
Provision for deferred income taxes | — | 11 | ||||||
Stock-based compensation expense | 29 | 86 | ||||||
Non-cash interest expense | 10 | 21 | ||||||
Loss on debt redemption | 7 | 68 | ||||||
Fair value of warrant issued related to sixth amendment to the WSA | — | 240 | ||||||
Other | (3 | ) | (8 | ) | ||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | 329 | 222 | ||||||
Inventories | 21 | (73 | ) | |||||
Prepayment and other - GLOBALFOUNDRIES | (19 | ) | 1 | |||||
Prepaid expenses and other assets | (32 | ) | (166 | ) | ||||
Payable to ATMP JV | (16 | ) | 128 | |||||
Payable to GLOBALFOUNDRIES | (29 | ) | 10 | |||||
Accounts payable, accrued liabilities and other | (93 | ) | 58 | |||||
Net cash provided by operating activities | $ | 188 | $ | 90 | ||||
Cash flows from investing activities: | ||||||||
Purchases of property, plant and equipment | (21 | ) | (77 | ) | ||||
Net proceeds from sale of equity interests in ATMP JV | (4 | ) | 342 | |||||
Other | (1 | ) | 2 | |||||
Net cash provided by (used in) investing activities | $ | (26 | ) | $ | 267 | |||
Cash flows from financing activities: | ||||||||
Proceeds from issuance of common stock, net of issuance costs | $ | (1 | ) | $ | 667 | |||
Proceeds from issuance of convertible senior notes, net of issuance costs | 101 | 782 | ||||||
Proceeds from issuance of common stock under stock-based compensation equity plans | 8 | 20 | ||||||
Repayments of long-term debt | (265 | ) | (1,113 | ) | ||||
Repayments of borrowings, net | — | (230 | ) | |||||
Other | 1 | (4 | ) | |||||
Net cash provided by (used in) financing activities | $ | (156 | ) | $ | 122 | |||
Net increase in cash and cash equivalents | 6 | 479 | ||||||
Cash and cash equivalents at beginning of period | $ | 1,258 | $ | 785 | ||||
Cash and cash equivalents at end of period | $ | 1,264 | $ | 1,264 |
Three Months Ended | Year Ended | |||||||||||||||||||
December 31, 2016 | September 24, 2016 | December 26, 2015 | December 31, 2016 | December 26, 2015 | ||||||||||||||||
Segment and Category Information | ||||||||||||||||||||
Computing and Graphics (1) | ||||||||||||||||||||
Net revenue | $ | 600 | $ | 472 | $ | 470 | $ | 1,967 | $ | 1,805 | ||||||||||
Operating loss | $ | (21 | ) | $ | (66 | ) | $ | (99 | ) | $ | (238 | ) | $ | (502 | ) | |||||
Enterprise, Embedded and Semi-Custom (2) | ||||||||||||||||||||
Net revenue | 506 | 835 | 488 | 2,305 | 2,186 | |||||||||||||||
Operating income | 47 | 136 | 59 | 283 | 215 | |||||||||||||||
All Other (3) | ||||||||||||||||||||
Net revenue | — | — | — | — | — | |||||||||||||||
Operating loss | (29 | ) | (363 | ) | (9 | ) | (417 | ) | (194 | ) | ||||||||||
Total | ||||||||||||||||||||
Net revenue | $ | 1,106 | $ | 1,307 | $ | 958 | $ | 4,272 | $ | 3,991 | ||||||||||
Operating loss | $ | (3 | ) | $ | (293 | ) | $ | (49 | ) | $ | (372 | ) | $ | (481 | ) | |||||
Other Data | ||||||||||||||||||||
Depreciation and amortization, excluding amortization of acquired intangible assets | $ | 34 | $ | 33 | $ | 34 | $ | 133 | $ | 164 | ||||||||||
Capital additions | $ | 21 | $ | 9 | $ | 32 | $ | 77 | $ | 96 | ||||||||||
Adjusted EBITDA (4) | $ | 60 | $ | 103 | $ | (5 | ) | $ | 177 | $ | (89 | ) | ||||||||
Cash and cash equivalents | $ | 1,264 | $ | 1,258 | $ | 785 | $ | 1,264 | $ | 785 | ||||||||||
Non-GAAP free cash flow (5) | $ | 167 | $ | 20 | $ | 27 | $ | 13 | $ | (322 | ) | |||||||||
Total assets | $ | 3,321 | $ | 3,616 | $ | 3,084 | $ | 3,321 | $ | 3,084 | ||||||||||
Total debt | $ | 1,435 | $ | 1,632 | $ | 2,237 | $ | 1,435 | $ | 2,237 |
(1 | ) | Computing and Graphics segment primarily includes desktop and notebook processors and chipsets, discrete graphics processing units (GPUs) and professional graphics. | |||||||||
(2 | ) | Enterprise, Embedded and Semi-Custom segment primarily includes server and embedded processors, semi-custom System-on-Chip (SoC) products and technology for game consoles. We also license portions of our intellectual property portfolio. | |||||||||
(3 | ) | All Other category primarily includes certain expenses and credits that are not allocated to any of the operating segments. Also included in this category is stock-based compensation expense. In addition, the Company also included charges related to: restructuring and other special charges, net for 2016, the fourth quarter of 2015 and 2015, the sixth amendment to the WSA with GF for the third quarter of 2016 and 2016 and amortization of acquired intangible assets for 2015. | |||||||||
(4 | ) | Reconciliation of GAAP Operating Loss to Adjusted EBITDA* |
Three Months Ended | Year Ended | |||||||||||||||||||
December 31, 2016 | September 24, 2016 | December 26, 2015 | December 31, 2016 | December 26, 2015 | ||||||||||||||||
GAAP operating loss | $ | (3 | ) | $ | (293 | ) | $ | (49 | ) | $ | (372 | ) | $ | (481 | ) | |||||
Charge related to the sixth amendment to the WSA with GF | — | 340 | — | 340 | — | |||||||||||||||
Restructuring and other special charges, net | — | — | (6 | ) | (10 | ) | 129 | |||||||||||||
Technology node transition charge | — | — | — | — | 33 | |||||||||||||||
Stock-based compensation expense | 29 | 23 | 16 | 86 | 63 | |||||||||||||||
Amortization of acquired intangible assets | — | — | — | — | 3 | |||||||||||||||
Depreciation and amortization | 34 | 33 | 34 | 133 | 164 | |||||||||||||||
Adjusted EBITDA | $ | 60 | $ | 103 | $ | (5 | ) | $ | 177 | $ | (89 | ) |
Three Months Ended | Year Ended | |||||||||||||||||||
December 31, 2016 | September 24, 2016 | December 26, 2015 | December 31, 2016 | December 26, 2015 | ||||||||||||||||
GAAP net cash provided by (used in) operating activities | $ | 188 | $ | 29 | $ | 59 | $ | 90 | $ | (226 | ) | |||||||||
Purchases of property, plant and equipment | (21 | ) | (9 | ) | (32 | ) | (77 | ) | (96 | ) | ||||||||||
Non-GAAP free cash flow | $ | 167 | $ | 20 | $ | 27 | $ | 13 | $ | (322 | ) |
* | The Company presents “Adjusted EBITDA” as a supplemental measure of its performance. Adjusted EBITDA for the Company is determined by adjusting operating income (loss) for depreciation and amortization and stock-based compensation expense. In addition, the Company excluded a charge related to the sixth amendment to the WSA with GF for the third quarter of 2016 and 2016, restructuring and other special charges, net for 2016, the fourth quarter of 2015 and 2015, a technology node transition charge and amortization of acquired intangible assets for 2015. The Company calculates and communicates Adjusted EBITDA because the Company’s management believes it is of importance to investors and lenders in relation to its overall capital structure and its ability to borrow additional funds. In addition, the Company presents Adjusted EBITDA because it believes this measure assists investors in comparing its performance across reporting periods on a consistent basis by excluding items that the Company does not believe are indicative of its core operating performance. The Company’s calculation of Adjusted EBITDA may or may not be consistent with the calculation of this measure by other companies in the same industry. Investors should not view Adjusted EBITDA as an alternative to the GAAP operating measure of operating income (loss) or GAAP liquidity measures of cash flows from operating, investing and financing activities. In addition, Adjusted EBITDA does not take into account changes in certain assets and liabilities as well as interest and income taxes that can affect cash flows. | |||||||||
** | The Company also presents non-GAAP free cash flow as a supplemental measure of its performance. Non-GAAP free cash flow is determined by adjusting GAAP net cash provided by (used in) operating activities for capital expenditures. The Company calculates and communicates non-GAAP free cash flow in the financial earnings press release because the Company’s management believes it is of importance to investors to understand the nature of these cash flows. The Company’s calculation of non-GAAP free cash flow may or may not be consistent with the calculation of this measure by other companies in the same industry. Investors should not view non-GAAP free cash flow as an alternative to GAAP liquidity measures of cash flows from operating activities. The Company has provided reconciliations within the earnings press release of these non-GAAP financial measures to the most directly comparable GAAP financial measures. |