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Part 1 Q&A
With that, I'll turn it back to Matt for the Q&A session.
Matt: Thank you, Jean.
Operator, we're ready to start the Q&A session now.
I would ask the callers to limit yourself to one question and one brief follow-up, but please go ahead and poll for questions.
Thank you.
OP: Thank you, Matt.
We will now be conducting a question and answer session.
If you would like to ask a question, please press star 1 on your telephone keypad.
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We ask that you please limit yourself to one question and one follow-up.
Thank you.
One moment, please, while we poll for questions.
And the first question comes from the line of Joshua Buckwalter with TD Cowan.
Please proceed with your question.
Joshua Buckwalter: Hey, guys.
Congrats on the results, and thanks for taking my question.
I'm actually going to start with CPUs, which hasn't happened in a bit.
It hasn't been that long since you announced the $60 billion server CPU TAM for 2030 at the Analyst Day, and it's very quickly doubled.
Agentic AI has obviously gotten a lot of attention in recent months, but it would be helpful to hear your thoughts on how this TAM is inflecting and changing so meaningfully in such a short amount of time.
And maybe you could also speak to your confidence in hitting that greater than 50% share target from the analyst day, as your x86 competitor seems to be improving its supply, and also there seems to be more momentum on the merchant and custom ARM CPU side.
Thank you.
Lisa: Yeah, sure, Josh. Thanks for the question.
So, first of all, back to when we think about CPU TAM. We've always said that CPUs are a very critical part of data center infrastructure, and that's been where we've invested. And we saw the first signs of, let's call it AI demand, really pulling CPU demand in last year, and that was the reason we updated the TAM to call it the 18% CAGR or approximately $60 billion.
And what we've seen is all of the things that we believed in terms of agentic AI and inferencing and all the CPU compute that is required is just happening, and it's happening at a much faster pace.
So over the last, let's call it the last few months as we've talked to our customers and we've seen how AI adoption is really unfolding, we're seeing a significant more CPU demand from really every major cloud provider as well as enterprise customers.
And the way that comes across is as AI adoption scales you need more inferencing.
At inferencing scales you have more agents and agentic AI.
They all require CPUs for all of the orchestration and the data processing and these other tasks.
So with that we looked at it both bottoms up in terms of talking to customers and having them give us longer-term forecasts, as well as just doing some clear workload analysis.
And yeah, I mean, it's a very exciting TAM.
I think it's exciting to see CPUs growing greater than 35% to over $120 billion.
And then when you think about AMD in the context of that,CPUs are critical for so many tasks that you are seeing a lot more discussion about CPUs in the market.
But we actually view it in three categories, right?
There's general purpose compute.
There's the head nodes that really support the AI accelerators, and then there's CPUs just for all of the agentic AI work.
And to do all of this, our belief is you need a broad portfolio of CPUs, and that's really what we have been focused on, is building not just one type, but really a broader in terms of throughput optimized, power optimized, cost optimized, AI infrastructure optimized as we've done in the Venice family. So when you put all that together, we're very excited about the larger TAM and we're also very happy with the traction that we're getting.
We're clearly feeling like we're seeing significant share gain as we're going into our Turin portfolio that has run very nicely.
Venice is extremely well positioned and we're working with customers right now on beyond Venice and what we're doing in those architectures.
So we feel really good about the market as well as our opportunity to grow to a greater than 50% share of that market.
Joshua: Okay thank you for all the color there then I want to ask about the instinct side so in the press release you mentioned that MI450 and Helios engagements are strengthening with customer forecasts exceeding the expectations and the pipeline growing, Um, you certainly have the big public OpenAI and Meta deals.
Was this comment referring to those engagements upsizing versus the announced initial deployments, or was it other customers and maybe the increase on the MI450 timeline, or is it MI500 and beyond?
Thank you.
Lisa: Sure, Josh.
So we are very excited about MI450 and Helios.
We're seeing significant customer interest in those products as well.
So we have certainly talked about our large partnerships with OpenAI and Meta, and those are going really well.
We appreciate the deep co-engineering that has gone on there.
When we look at the totality of, let's call it based on our current visibility, how those forecasts are coming in with all of our customers we're actually seeing it above our initial plans that we had planned for 2027 and I think the encouraging thing is we're seeing a breadth of customers who are now very interested in deploying at significant scale MI450 series nodes and those and those are for both training and inference workloads, although the largest deployments are for inference.
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.
And these are really 2027 timeframe.
Obviously, when we talk to customers, we're talking to them about MI355.
There's a lot of good traction we're seeing there.
MI450 and Helios, I think, for significant large-scale deployments.
And then many customers are also very engaged with us on the MI500 series and all of the opportunities there.
So we feel like very, very good progress and the key is that we're continuing to broaden and widen the scope of both customers as well as workloads.
OP: And the next question comes from the line of Thomas O'Malley with Barclays, please proceed with your question.
Thomas O'Malley: Hey guys thanks for taking my question ,Lisa, Lisa: if I get your numbers correct here in the March quarter it sounds like the server processor side of the CPU side grew over 50% if you take it just at the word it looks like maybe the data center GPU side actually grew in q1 so I was curious around the cadence of this year, kind of previously you had talked about really a back half weighted and then kind of more so Q4 weighted year.
Could you talk about if that's changed at all?
And then the second part of the question is, as you go into 2027, clearly you're pointing out a lot of upside from the larger customers and then kind of the ecosystem around them with new customers as well.
But when you look at supply, that's a major issue in the ecosystem today.
Could you talk about where you're concerned on supply, if you are, and then any gating factors as you look into next year, whether that be power, data center build-outs, et cetera, or do you feel really good about the ability to grow?
Thank you very much.
Lisa: Yeah, okay.
A lot of pieces of that question, Tom, so let me try to get through it.
So first of all, on the data center segment in Q1, the server business was greater than 50% year over year, as we said in the prepared remarks.
The data center AI was actually down modestly because of the China transition.
We had more China revenue…I'm sorry, sequentially, more China revenue in Q4, and it was less in Q1. But as we go forward, I think we see strong growth in both segments.
So we guided data center Q2 up sequentially double digits, and that's double digits in both server as well as data center AI.
And progression as we go forward, so first on the server CPU side, we talked about growing to over 70% year-over-year in Q2 and that continuing into the second half of the year.
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. So that's kind of a little bit of progression.
And then to your questions about customers and supply, I think I answered, Josh, the customer question.
I think we have very good visibility now into the deployments that are on track for 2027.
And when I say good visibility, it's visibility down to which data centers are the GPUs going to be installed in. And so that's necessary just given all of the constraints out there.
We feel that there is tightness in the supply chain. There is certainly tightness in sort of data center build-outs, but we are confident in our ability to supply to the levels of growth that we're talking about and to exceed the levels of growth that we're talking about.
And we're also working very closely with our customers and our partners to ensure that we have good visibility to data center power and there is much more power That's coming online in 2027 And so with all those things in mind, I think you know again lots of things to manage They say it's a complex ramp, but we're very very pleased with the progress on the ramp
Matt: All right, Tom, I think you shotgunned approach the multiple questions there.
So, operator, maybe we can go on to the next caller, please.
Thank you.
Tom: Thank you.

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