Advanced Micro Devices Inc. (NASDAQ:AMD)

Gross Profit Margin

The gross profit margin shows a consistent upward trend starting from 44.53% in March 2021 and reaching 50.09% by March 2025. This indicates improving efficiency in production or favorable pricing strategies over the period analyzed, reflecting a stronger ability to retain revenue after accounting for the cost of goods sold.

Operating Profit Margin

The operating profit margin initially increases from 14.02% in March 2021 to a peak of 22.20% in March 2022. Thereafter, it experiences a significant decline, dropping to negative values between April 2023 and September 2023. From December 2023 onwards, the margin recovers gradually, reaching 9.62% by March 2025. This fluctuation suggests volatile operating conditions, possibly due to increased operating expenses or changes in revenue mix affecting profitability at the operating level.

Net Profit Margin

The net profit margin follows a similar pattern to the operating margin, with a peak of 26.72% in December 2021, followed by a decline to a low point around negative 0.11% in September 2023. After this trough, it shows a recovery trend, increasing steadily to 8.03% by March 2025. This pattern may reflect the impact of non-operating factors such as interest and taxes, alongside operational performance changes, with recovery indicating improved profitability and cost control.

Return on Equity (ROE)

The ROE exhibits strong performance with values above 40% until December 2021, peaking at 55.62%. A sharp decline then occurs, reaching near zero and even slightly negative in September 2023. From December 2023, ROE gradually increases but remains low relative to earlier highs, ending at 3.85% in March 2025. This trajectory signifies a reduction in profitability relative to shareholders' equity, possibly due to lower net income and changes in equity structure.

Return on Assets (ROA)

Similarly, ROA remains robust above 25% until late 2021, peaking at 35.59% in December 2021, before decreasing sharply to near zero and slightly negative in September 2023. A recovery trend follows, improving to 3.11% by March 2025. This indicates a diminished efficiency in asset utilization during the middle period but also suggests gradual asset performance recovery toward the end of the timeframe.

The financial data indicates clear trends in terms of revenue generation and profitability over the observed periods. The net revenue shows a generally increasing trajectory from March 2020 through March 2025, with some fluctuations. Starting at approximately 1,786 million US dollars in March 2020, revenue peaks notably at 7,658 million US dollars by December 2024, before a slight decline to 7,438 million US dollars in March 2025. This overall growth suggests an expansion in the company's sales or market reach over the five-year period.

Gross profit follows a similar upward trend but presents more volatility in the later periods. Gross profit rose from 818 million US dollars in March 2020 to a high point of 3,882 million US dollars in December 2024, then decreased to 3,736 million US dollars in March 2025. Despite the fluctuations, the gross profit values remain substantially above the early figures, indicating an overall improvement in the company's core profitability.

Examining the gross profit margin, which is a key indicator of operational efficiency, it is evident that the margin improved steadily over time. Initially, data is missing for early 2020 quarters, but starting from December 2020, the margin was around 44.53%, increasing incrementally to reach over 50% by March 2025. This consistent upward movement in margin suggests the company has enhanced its cost management or pricing strategies, translating revenue growth into proportionally higher profits.

Net Revenue Trends

Marked growth with occasional declines, reflecting expansion and market dynamics.

Gross Profit Trends

Substantial increase overall, with some volatility in the most recent quarters, indicating improving core profitability but some short-term variability.

Gross Profit Margin

Steady improvement from approximately 44.5% to above 50%, showing increased operational efficiency and improved profitability relative to revenue.

In summary, the company exhibits strong growth in sales alongside rising profitability and improving margin ratios over the five-year timeframe, signaling efficient scaling of operations and enhanced financial performance. The recent slight declines in gross profit and revenue at the end of the period warrant monitoring but do not significantly detract from the long-term positive trend.

The analysis of the quarterly financial data reveals several notable trends in the company's operating income, net revenue, and operating profit margin over the reported periods.

Operating Income (Loss)

The operating income demonstrated a progressive increase from March 2020, starting at $177 million and reaching a peak of $1,207 million in December 2021. Following this peak, there was a notable decline with some quarters turning negative, particularly in September 2022 and December 2022, showing losses of $64 million and $149 million respectively. Recovery efforts appear evident as operating income returned to positive territory from 2023 onwards, fluctuating moderately and reaching values up to $871 million in December 2024, before decreasing slightly to $806 million by March 2025.

Net Revenue

Net revenue experienced a strong upward trend throughout the majority of the periods, increasing from $1,786 million in March 2020 to a high of $7,658 million in December 2024. There was a slight decline observed in September 2022 and December 2022, corresponding possibly with the decline in operating income during the same timeframe. However, net revenue swiftly rebounded post-2022, maintaining an upward trajectory with some fluctuations, ending at $7,438 million in March 2025.

Operating Profit Margin

The operating profit margin data, available from late 2020, showed a steady improvement initially, rising from 14.02% in September 2020 to a peak of 22.2% in December 2021. This positive margin trend aligns with the increased operating income and net revenue observed. Subsequently, the margin dropped significantly through 2022 to a low of -1.73% in December 2022, reflecting the operating losses recorded during that period. From 2023 onwards, the margin gradually improved again, reaching 9.62% by March 2025, indicating a recovery in operational efficiency and profitability.

In summary, the financial data exhibits growth and strong operational performance through 2021, followed by a period of financial strain around 2022 as reflected in both declining operating income and profit margins. The company showed signs of recovery beginning in 2023, stabilizing net revenue and improving profitability margins progressively into early 2025. Continuous monitoring of these trends will be essential to assess the sustainability of the recovery phase.

Net Income (Loss)

The net income demonstrates considerable volatility over the observed period. Initially, there is a modest positive income with values around 162 to 390 million USD in early 2020. A significant peak occurs in December 2020 with net income reaching 1,781 million USD. Following this high point, the net income declines and fluctuates, including a pronounced drop to negative 139 million USD in the first quarter of 2023. Subsequently, the income shows recovery and generally trends upwards, culminating at 709 million USD by the last reported quarter in March 2025. This reflects a cycle of strong earnings growth, a period of challenges, and partial recovery.

Net Revenue

Net revenue exhibits a consistent upward trajectory throughout the period. Starting at approximately 1,786 million USD in early 2020, revenue increases steadily each quarter, reaching a high of 6,819 million USD by September 2024. Despite minor fluctuations, the overall trend points to substantial growth in sales over time. This steady revenue increase contrasts with the more variable net income results, indicating factors affecting profitability beyond sales volume alone.

Net Profit Margin

Data for net profit margin begins explicitly in December 2020, initially reflecting strong profitability with margins above 25%. This high margin decreases progressively over the next quarters, dropping to a low of -0.11% in the first quarter of 2023, coinciding with the negative net income observed in the same period. From this point, the margin displays gradual improvement, rising back above 8% by the end of the period in March 2025. The downward trend followed by recovery in profit margin indicates fluctuations in cost management, pricing, or other operational efficiencies during the timeframe.

Overall Analysis

The trends underscore a company experiencing rapid revenue growth accompanied by variable profitability. The peak in net income and profit margin around late 2020 corresponds with a period of maximal profitability. Thereafter, both measures decline substantially, evidencing operational or market challenges leading to decreased earnings quality. The recovery signs beginning in 2023 suggest strategic or market adjustments were effective in restoring profit levels. The divergence between steady revenue growth and fluctuating net income and margin could imply increased costs, competitive pressures, or investments impacting short-term profitability despite higher sales.

The financial data reveals several notable trends regarding net income, stockholders’ equity, and return on equity (ROE) over the observed periods.

Net Income (Loss)

The net income exhibits significant volatility throughout the reported quarters. Starting from a positive value of 162 million USD in March 2020, net income experienced a steep rise peaking at 1781 million USD in December 2020. Following this peak, net income showed a declining trend with fluctuations, dropping substantially to as low as 21 million USD in December 2022 and even reaching a negative value of -139 million USD in April 2023. Subsequently, net income appears to recover, recording progressive increases and stabilizing around mid to high hundreds of millions USD by early 2025.

Stockholders’ Equity

Stockholders' equity shows a general upward trend from 3037 million USD in March 2020 to approximately 7497 million USD by December 2021. Thereafter, a substantial and abrupt increase occurred, with equity surpassing 55 billion USD from March 2022 onward and showing steady increments to nearly 58 billion USD by March 2025. This notable rise suggests possible changes such as equity financing activities, asset revaluations, or other capital adjustments during the early 2022 period.

Return on Equity (ROE)

ROE data available from December 2020 reflects a highly elevated level, starting at 42.66% and peaking at 55.62% in December 2021. However, the subsequent quarters show a marked decrease, with ROE dropping drastically to low single-digit percentages by late 2022 and fluctuating around 0.7% to 3.85% through early 2025. This decline corresponds with the sharp rise in stockholders’ equity and the concurrent reduction in net income, indicating diminishing profitability relative to the company's equity base over this period.

In summary, the company experienced a period of exceptional profitability up to late 2021, followed by considerable challenges in sustaining net income and return on equity despite a massive increase in stockholders’ equity. This pattern suggests significant capital or structural changes impacting financial returns, warranting deeper investigation into underlying factors such as financing strategy, asset composition, or market conditions during the later periods.

The financial data reveals several noteworthy trends in profitability, asset growth, and return on assets (ROA) over the presented periods.

Net Income (Loss)

The net income figures exhibit pronounced volatility across the quarters. Starting at a moderate level in early 2020, the company experienced a substantial spike in net income by December 2020, reaching its peak within the dataset at 1,781 million US dollars. This peak was followed by fluctuations in subsequent quarters, with values oscillating and in some cases declining sharply to near zero or negative figures, such as the -139 million US dollars recorded in April 2023. From mid-2023 onwards, net income showed signs of recovery, rising again to levels above 700 million US dollars by the end of the analyzed period.

Total Assets

Total assets demonstrate a significant increase from 2020 through early 2022. Beginning at approximately 5,864 million US dollars in March 2020, the total assets nearly doubled to over 67,000 million US dollars by March 2022. Thereafter, asset levels remained relatively stable with minor fluctuations, maintaining a range between approximately 67,000 and 71,000 million US dollars through to March 2025. This suggests a rapid expansion phase followed by asset stabilization.

Return on Assets (ROA)

Return on assets shows an initial period of high profitability, reaching above 35% in December 2020. This high ROA corresponds with the peak in net income and indicates efficient utilization of assets during that period. Following this peak, ROA trend declined sharply through 2022, reaching lows close to zero and slightly negative territory by early 2023. In subsequent quarters, ROA demonstrated a gradual recovery trend, improving steadily to over 3% by the end of the last reporting period, suggesting a slow restoration of asset efficiency.

Overall, the data indicates a period of rapid growth and peak profitability around late 2020, accompanied by significant asset accumulation. This was followed by periods marked by volatility and decline in profitability and operational efficiency, reaching trough levels in early 2023. The most recent data points convey a positive trajectory in both income and return metrics, though profitability and efficiency remain well below their earlier peaks. Asset levels have stabilized after the rapid expansion, implying a phase of consolidation.