Stock Analysis on Net

Advanced Micro Devices Inc. (NASDAQ:AMD)

Analysis of Goodwill and Intangible Assets

Microsoft Excel

Goodwill and Intangible Asset Disclosure

Advanced Micro Devices Inc., balance sheet: goodwill and intangible assets

US$ in millions

Microsoft Excel
Dec 30, 2023 Dec 31, 2022 Dec 25, 2021 Dec 26, 2020 Dec 28, 2019
Developed technology 13,390 12,360
Customer relationships 12,324 12,324
Customer backlog 809 809
Corporate trade name 65 65
Product trademarks 914 914
Identified intangible assets subject to amortization, gross 27,502 26,472
Accumulated amortization (6,359) (3,548)
Identified intangible assets subject to amortization, net 21,143 22,924
IPR&D not subject to amortization 220 1,194
Acquisition-related intangible assets 21,363 24,118
Goodwill 24,262 24,177 289 289 289
Acquisition-related intangible assets and goodwill 45,625 48,295 289 289 289

Based on: 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26), 10-K (reporting date: 2019-12-28).

Item Description The company
Acquisition-related intangible assets Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Advanced Micro Devices Inc. acquisition-related intangible assets increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.
Goodwill Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Advanced Micro Devices Inc. goodwill increased from 2021 to 2022 and from 2022 to 2023.
Acquisition-related intangible assets and goodwill Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Advanced Micro Devices Inc. acquisition-related intangible assets and goodwill increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.

Adjustments to Financial Statements: Removal of Goodwill

Advanced Micro Devices Inc., adjustments to financial statements

US$ in millions

Microsoft Excel
Dec 30, 2023 Dec 31, 2022 Dec 25, 2021 Dec 26, 2020 Dec 28, 2019
Adjustment to Total Assets
Total assets (as reported) 67,885 67,580 12,419 8,962 6,028
Less: Goodwill 24,262 24,177 289 289 289
Total assets (adjusted) 43,623 43,403 12,130 8,673 5,739
Adjustment to Stockholders’ Equity
Stockholders’ equity (as reported) 55,892 54,750 7,497 5,837 2,827
Less: Goodwill 24,262 24,177 289 289 289
Stockholders’ equity (adjusted) 31,630 30,573 7,208 5,548 2,538

Based on: 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26), 10-K (reporting date: 2019-12-28).


Advanced Micro Devices Inc., Financial Data: Reported vs. Adjusted


Adjusted Financial Ratios: Removal of Goodwill (Summary)

Advanced Micro Devices Inc., adjusted financial ratios

Microsoft Excel
Dec 30, 2023 Dec 31, 2022 Dec 25, 2021 Dec 26, 2020 Dec 28, 2019
Total Asset Turnover
Reported total asset turnover 0.33 0.35 1.32 1.09 1.12
Adjusted total asset turnover 0.52 0.54 1.35 1.13 1.17
Financial Leverage
Reported financial leverage 1.21 1.23 1.66 1.54 2.13
Adjusted financial leverage 1.38 1.42 1.68 1.56 2.26
Return on Equity (ROE)
Reported ROE 1.53% 2.41% 42.18% 42.66% 12.06%
Adjusted ROE 2.70% 4.32% 43.87% 44.88% 13.44%
Return on Assets (ROA)
Reported ROA 1.26% 1.95% 25.46% 27.78% 5.66%
Adjusted ROA 1.96% 3.04% 26.07% 28.71% 5.94%

Based on: 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26), 10-K (reporting date: 2019-12-28).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Advanced Micro Devices Inc. adjusted total asset turnover ratio deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Advanced Micro Devices Inc. adjusted financial leverage ratio decreased from 2021 to 2022 and from 2022 to 2023.
Adjusted ROE A profitability ratio calculated as net income divided by adjusted shareholders’ equity. Advanced Micro Devices Inc. adjusted ROE deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Advanced Micro Devices Inc. adjusted ROA deteriorated from 2021 to 2022 and from 2022 to 2023.

Advanced Micro Devices Inc., Financial Ratios: Reported vs. Adjusted


Adjusted Total Asset Turnover

Microsoft Excel
Dec 30, 2023 Dec 31, 2022 Dec 25, 2021 Dec 26, 2020 Dec 28, 2019
As Reported
Selected Financial Data (US$ in millions)
Net revenue 22,680 23,601 16,434 9,763 6,731
Total assets 67,885 67,580 12,419 8,962 6,028
Activity Ratio
Total asset turnover1 0.33 0.35 1.32 1.09 1.12
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net revenue 22,680 23,601 16,434 9,763 6,731
Adjusted total assets 43,623 43,403 12,130 8,673 5,739
Activity Ratio
Adjusted total asset turnover2 0.52 0.54 1.35 1.13 1.17

Based on: 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26), 10-K (reporting date: 2019-12-28).

2023 Calculations

1 Total asset turnover = Net revenue ÷ Total assets
= 22,680 ÷ 67,885 = 0.33

2 Adjusted total asset turnover = Net revenue ÷ Adjusted total assets
= 22,680 ÷ 43,623 = 0.52

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Advanced Micro Devices Inc. adjusted total asset turnover ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
Dec 30, 2023 Dec 31, 2022 Dec 25, 2021 Dec 26, 2020 Dec 28, 2019
As Reported
Selected Financial Data (US$ in millions)
Total assets 67,885 67,580 12,419 8,962 6,028
Stockholders’ equity 55,892 54,750 7,497 5,837 2,827
Solvency Ratio
Financial leverage1 1.21 1.23 1.66 1.54 2.13
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted total assets 43,623 43,403 12,130 8,673 5,739
Adjusted stockholders’ equity 31,630 30,573 7,208 5,548 2,538
Solvency Ratio
Adjusted financial leverage2 1.38 1.42 1.68 1.56 2.26

Based on: 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26), 10-K (reporting date: 2019-12-28).

2023 Calculations

1 Financial leverage = Total assets ÷ Stockholders’ equity
= 67,885 ÷ 55,892 = 1.21

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted stockholders’ equity
= 43,623 ÷ 31,630 = 1.38

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.
Advanced Micro Devices Inc. adjusted financial leverage ratio decreased from 2021 to 2022 and from 2022 to 2023.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 30, 2023 Dec 31, 2022 Dec 25, 2021 Dec 26, 2020 Dec 28, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income 854 1,320 3,162 2,490 341
Stockholders’ equity 55,892 54,750 7,497 5,837 2,827
Profitability Ratio
ROE1 1.53% 2.41% 42.18% 42.66% 12.06%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income 854 1,320 3,162 2,490 341
Adjusted stockholders’ equity 31,630 30,573 7,208 5,548 2,538
Profitability Ratio
Adjusted ROE2 2.70% 4.32% 43.87% 44.88% 13.44%

Based on: 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26), 10-K (reporting date: 2019-12-28).

2023 Calculations

1 ROE = 100 × Net income ÷ Stockholders’ equity
= 100 × 854 ÷ 55,892 = 1.53%

2 Adjusted ROE = 100 × Net income ÷ Adjusted stockholders’ equity
= 100 × 854 ÷ 31,630 = 2.70%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as net income divided by adjusted shareholders’ equity. Advanced Micro Devices Inc. adjusted ROE deteriorated from 2021 to 2022 and from 2022 to 2023.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 30, 2023 Dec 31, 2022 Dec 25, 2021 Dec 26, 2020 Dec 28, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income 854 1,320 3,162 2,490 341
Total assets 67,885 67,580 12,419 8,962 6,028
Profitability Ratio
ROA1 1.26% 1.95% 25.46% 27.78% 5.66%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net income 854 1,320 3,162 2,490 341
Adjusted total assets 43,623 43,403 12,130 8,673 5,739
Profitability Ratio
Adjusted ROA2 1.96% 3.04% 26.07% 28.71% 5.94%

Based on: 10-K (reporting date: 2023-12-30), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-25), 10-K (reporting date: 2020-12-26), 10-K (reporting date: 2019-12-28).

2023 Calculations

1 ROA = 100 × Net income ÷ Total assets
= 100 × 854 ÷ 67,885 = 1.26%

2 Adjusted ROA = 100 × Net income ÷ Adjusted total assets
= 100 × 854 ÷ 43,623 = 1.96%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as net income divided by adjusted total assets. Advanced Micro Devices Inc. adjusted ROA deteriorated from 2021 to 2022 and from 2022 to 2023.