6 unchanged sentences
◦ Intel Corporation’s dominance of the microprocessor market and its aggressive business practices may limit our ability to compete effectively on a level playing field.
−Removed: • Economic and market uncertainty may adversely impact our business and operating results.
+Added: ◦ Nvidia’s dominance in the graphics processing unit market and its aggressive business practices may limit our ability to compete effectively on a level playing field.
+Added: ◦ The markets in which our products are sold are highly competitive and rapidly evolving.
◦ The semiconductor industry is highly cyclical and has experienced severe downturns.
◦ The demand for our products depends in part on the market conditions in the industries into which they are sold.
−Removed: There may be fluctuations in demand for our products or a market decline in any of these industries.
+Added: ◦ The success of our business depends on our ability to introduce products on a timely basis with features and performance levels that provide value to our customers while supporting significant industry transitions.
◦ The loss of a significant customer may have a material adverse effect on us.
−Removed: • We are subject to risks associated with public health crises, such as pandemics and epidemics.
−Removed: • The markets in which our products are sold are highly competitive.
+Added: ◦ Economic and market uncertainty may adversely impact our business and operating results.
◦ Our operating results are subject to quarterly and seasonal sales patterns.
5 unchanged sentences
◦ We may fail to achieve expected manufacturing yields for our products.
−Removed: • The success of our business is dependent upon our ability to introduce products on a timely basis with features and performance levels that provide value to our customers while supporting significant industry transitions.
◦ Our revenue from our semi-custom System-on-Chip (SoC) products is dependent upon our semi-custom SoC products being incorporated into customers’ products and the success of those products.
1 unchanged sentence
◦ IT outages, data loss, data breaches and cyberattacks could disrupt operations and compromise our intellectual property or other sensitive information, be costly to remediate or cause significant damage to our business, reputation, financial condition and results of operations.
−Removed: • We may encounter difficulties in operating our newly upgraded enterprise resource planning (ERP) system.
◦ Uncertainties involving the ordering and shipment of our products could materially adversely affect us.
15 unchanged sentences
◦ We are party to litigation and may become a party to other claims or litigation.
−Removed: • We are subject to environmental laws, conflict minerals-related provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and other laws or regulations that could result in additional costs and liabilities.
+Added: ◦ We are subject to environmental laws, conflict minerals regulations, as well as a variety of other laws or regulations.
◦ Evolving expectations from governments, investors, customers and other stakeholders regarding corporate responsibility matters could result in additional costs, harm to our reputation and a loss of customers.
◦ Issues related to the responsible use of AI may result in reputational, competitive and financial harm and liability.
−Removed: Merger, Acquisition and Integration Risks
−Removed: • Acquisitions, joint ventures, and/or investments, and the failure to integrate acquired businesses may fail to materialize their anticipated benefits and disrupt our business.
+Added: ◦ The agreements governing our notes, our guarantee of Xilinx’s notes, and our Revolving Credit Agreement impose restrictions on us that may adversely affect our ability to operate our business.
+Added: Merger, Acquisition, Divestiture, and Integration Risks
+Added: ◦ Acquisitions, joint ventures, and/or strategic investments, and the failure to integrate acquired businesses may fail to materialize their anticipated benefits and could disrupt our business.
+Added: ◦ Our ability to complete the acquisition of ZT Systems is subject to closing conditions.
◦ Any impairment of our tangible, definite-lived intangible or indefinite-lived intangible assets, including goodwill, may adversely impact our financial position and results of operations.
−Removed: Liquidity and Capital Resources Risks
−Removed: • The agreements governing our notes, our guarantees of Xilinx’s notes, and our Revolving Credit Agreement impose restrictions on us that may adversely affect our ability to operate our business.
−Removed: • Our indebtedness could adversely affect our financial position and prevent us from implementing our strategy or fulfilling our contractual obligations.
−Removed: • We may not generate sufficient cash to meet our working capital requirements.
−Removed: If we cannot generate sufficient revenue and operating cash flow, we may face a cash shortfall.
−Removed: Also, our cash and cash equivalents could be adversely affected if the financial institutions in which we hold our cash and cash equivalents fail.
General Risks
15 unchanged sentences
We expect Intel to continue to heavily invest substantial resources in marketing, research and development, new manufacturing facilities and other technology companies.
−Removed: To the extent Intel manufactures a significantly larger portion of its microprocessor products using more advanced process technologies or introduces competitive new products into the market before we do, we may be more vulnerable to Intel’s aggressive marketing and pricing strategies for microprocessor products.
−Removed: We also compete with Intel in field programmable gate arrays (FPGAs) and Adaptive SoC products.
−Removed: In the graphics processing unit (GPU) market, Intel has developed and released their own high-end discrete GPUs, including gaming focused discrete GPUs.
−Removed: Intel could take actions that place our GPUs at a competitive disadvantage, including giving one or more of our competitors in the graphics market preferential access to its proprietary graphics interface or other useful information or restricting access to external companies.
−Removed: Economic and market uncertainty may adversely impact our business and operating results.
−Removed: Uncertain global or regional economic conditions have and may in the future adversely impact our business.
−Removed: Uncertainty in the economic environment or other unfavorable changes in economic conditions, such as inflation, higher interest rates, recession, slowing growth, increased unemployment, tighter credit markets, changes in fiscal monetary or trade policy, or currency fluctuations, may negatively impact consumer confidence and spending causing our customers to stop or postpone purchases.
−Removed: For example, our Client segment revenue decreased due to a decline in the PC market in the second half of 2022 and the first half of 2023, and our Embedded segment revenue decreased as a result of an inventory correction in several end markets in the second half of 2023.
−Removed: During challenging economic times, our current or potential future customers may experience cash flow problems and as a result may modify, delay or cancel plans to purchase our products.
−Removed: Additionally, if our customers are not successful in generating sufficient revenue or are unable to secure financing, they may not be able to pay, or may delay payment of, accounts receivable that they owe us.
−Removed: The risk related to our customers potentially defaulting on or delaying payments to us is increased because we expect that a small number of customers will continue to account for a substantial part of our revenue.
−Removed: Any inability of our current or potential future customers to pay us for our products may adversely affect our earnings and cash flow.
−Removed: Moreover, our key suppliers may reduce their output or become insolvent, thereby adversely impacting our ability to manufacture our products.
−Removed: Adverse changes in economic conditions could increase costs of memory, equipment, materials or substrates and other supply chain expenses.
−Removed: If we are not able to procure a stable supply of materials on an ongoing basis and at reasonable costs to meet our production requirements, we could experience a supply shortage or an increase in production costs, which could negatively impact our gross margin and materially adversely affect our business.
−Removed: In addition, uncertain economic conditions could lead to higher borrowing costs and reduced availability of capital and credit markets, making it more difficult for us to raise funds through borrowings or private or public sales of debt or equity securities.
−Removed: An economic downturn or increased uncertainty could also lead to failures of counterparties including financial institutions and insurers, asset impairments and declines in the value of our financial instruments.
+Added: Nvidia’s dominance in the graphics processing unit market and its aggressive business practices may limit our ability to compete effectively on a level playing field.
+Added: Nvidia’s Data Center GPU market share position, significant financial resources, introduction of competitive new products and proprietary software ecosystem have enabled it to market and price its products in a manner to encourage the selection of Nvidia-based systems and to influence customers who do business with us.
+Added: We may be materially adversely affected by Nvidia’s business practices, including allocation strategies and pricing actions;
+Added: product mix and introduction schedules;
+Added: and product bundling strategies.
+Added: Nvidia’s practices can limit customers’ ability to choose non-Nvidia products, including our products, and in turn, may limit our market share and decrease our margins and profitability, which could have a material adverse effect on our business.
+Added: We expect Nvidia to continue to heavily invest substantial resources in research and development, marketing and other technology companies.
+Added: The markets in which our products are sold are highly competitive and rapidly evolving.
+Added: The markets in which our products are sold are highly competitive and rapidly evolving.
+Added: We expect that competition will continue to be intense due to rapid technological changes, new and evolving industry standards, changing customer preferences and requirements, and frequent introductions by our competitors or new competitors of products that may provide better performance/experience or that may include additional features that render our products comparatively less competitive.
+Added: In addition, we are entering markets with current and new competitors who may be able to adapt more quickly to customer requirements and emerging technologies.
+Added: For example, the AI market is subject to rapid technological change, product obsolescence, frequent new product introductions and feature enhancements, changes in end-user requirements and evolving industry trends and legal standards.
+Added: We cannot guarantee that we will be able to compete successfully against current or new competitors who may have stronger positions in these new markets or superior ability to anticipate customer requirements and emerging industry trends.
+Added: While we see significant opportunity in AI, we expect intense competition from companies such as Nvidia in the supply of GPUs and other accelerators for the AI market.
+Added: We may face competition from some of our customers who internally develop the same products as us.
+Added: Increased adoption of Arm-based semiconductor designs could lead to further growth and development of the Arm ecosystem.
+Added: We may also face delays or disruptions in research and development efforts, or we may be required to invest significantly greater resources in research and development than anticipated.
+Added: In addition, the semiconductor industry has seen several mergers and acquisitions over the last number of years.
+Added: Further consolidation could adversely impact our business due to there being fewer suppliers, customers and partners in the industry.
+Added: We believe that the main factors that determine our product competitiveness are total cost of ownership, timely product introductions, product quality, product features and capabilities (including accelerations for key workloads such as AI, energy efficiency (including power consumption and battery life, given their impact on total cost of ownership), reliability, performance, size (or form factor), selling price, cost, adherence to industry standards (and the creation of open industry standards), level of integration, software and hardware compatibility, ease of use and functionality of software design tools, completeness of applicable software solutions, security and stability, brand recognition and availability.
+Added: If competitors introduce competitive new products into the market before us, demand for our products could be adversely impacted and our business could be adversely affected.
+Added: Further, our competitors have significant marketing and sales resources which could increase the competitive environment in a declining market or during challenging economic times, leading to lower prices and a reduction in our margins.
+Added: To the extent our competitors introduce competitive new products and technologies into the market before we do, or introduce products and technologies that provide better performance/experience or at better prices, our products and technologies may be comparatively less competitive and our competitive position may weaken, which could adversely harm our business and results of operations.
+Added: From time to time, governments provide incentives or make other investments that could benefit and give a competitive advantage to our competitors.
+Added: For example, the United States government enacted the Creating Helpful Incentives to Produce Semiconductors for America and Science Act (CHIPS Act) of 2022 to provide financial incentives to the U.S.
+Added: semiconductor industry.
+Added: Government incentives, including the CHIPS Act, may not be available to us on acceptable terms or at all.
+Added: If our competitors can benefit from such government incentives and we cannot, it could strengthen our competitors’ relative position and have a material adverse effect on our business.
The semiconductor industry is highly cyclical and has experienced severe downturns that have materially adversely affected, and may continue to materially adversely affect, our business in the future.
6 unchanged sentences
Global economic uncertainty and weakness have in the past impacted the semiconductor market as consumers and businesses have deferred purchases, which negatively impacted demand for our products.
−Removed: For example, our Client segment revenue decreased due to a decline in the PC market in the second half of 2022 and the first half of 2023, and our Embedded segment revenue decreased as a result of an inventory correction in several end markets in the second half of 2023.
Our financial performance has been, and may in the future be, negatively affected by these downturns.
6 unchanged sentences
We offer products that are used in different end markets and the demand for our products can vary among our Data Center, Client, Gaming and Embedded end markets.
−Removed: For instance, in our Data Center segment, we offer products that are optimized for generative AI applications and in the fourth quarter of 2023, we experienced significant demand for our AI accelerators.
−Removed: The demand for such products will depend on the extent to which our customers utilize generative AI solutions in a wide variety of applications.
−Removed: Also, in our Client segment revenue is focused on the consumer desktop and notebook PC segments.
−Removed: Our Client segment revenue decreased due to a decline in the PC market in the second half of 2022 and the first half of 2023.
+Added: For instance, in our Data Center segment, we offer products that are optimized for generative AI applications and since the fourth quarter of 2023, we have experienced significant demand for our AI accelerators.
+Added: The demand for such products in part will depend on the extent to which our customers utilize generative AI solutions in a wide variety of applications, and both the near-term and long-term trajectory of such generative AI solutions is unknown.
+Added: Also, our Client segment revenue is focused on the consumer desktop and notebook PC segments and will depend in part on the market’s adoption of AI PCs.
+Added: We are actively building AI capabilities into all our Client products, such as Ryzen AI PC processors, but there can be no assurance about the rate and pace of adoption of such product offerings.
In the past, revenues from the Client and Gaming segments have experienced a decline driven by, among other factors, the adoption of smaller and other form factors, increased competition and changes in replacement cycles.
4 unchanged sentences
To the extent our embedded customers are faced with higher inventory levels, they may choose to draw down their existing inventory and order less of our products.
−Removed: Our Embedded segment revenue decreased as a result of an inventory correction in several end markets in the second half of 2023.
+Added: For example, our Embedded segment revenue decreased in 2024 as customers continued to normalize their inventory levels.
+Added: The success of our business depends on our ability to introduce products on a timely basis with features and performance levels that provide value to our customers while supporting and coinciding with significant industry transitions.
+Added: Our success depends to a significant extent on the development, qualification, implementation and acceptance of new product designs and improvements that provide value to our customers.
+Added: Our ability to identify industry changes, and adapt our strategy to develop, qualify and distribute, and have manufactured, new products and related technologies to meet evolving industry trends and requirements, at prices acceptable to our customers and on a timely basis, are significant factors in determining our competitiveness in our target markets.
+Added: We cannot assure you that we will be able to meet the evolving needs of industry changes or that our efforts to execute our product roadmap will result in innovative products and technologies that provide value to our customers.
+Added: If we fail to or are delayed in identifying, developing, qualifying or shipping new products or technologies that provide value to our customers and address these new trends, or if we fail to predict which new form factors, product features preferences or requirements consumers will adopt and adapt our business accordingly, we may lose competitive positioning, which could cause us to lose market share and require us to discount the selling prices of our products.
+Added: Although we make substantial investments in research and development, we cannot be certain that we will be able to develop, obtain or successfully implement new products and technologies on a timely basis or that they will be well-received by our customers.
+Added: Moreover, our investments in new products and technologies involve certain risks and uncertainties and could disrupt our ongoing business.
+Added: New investments may not generate sufficient revenue, may incur unanticipated liabilities and may divert our limited resources and distract management from our current operations.
+Added: We cannot be certain that our ongoing investments in new products and technologies will be successful, will meet our expectations and will not adversely affect our reputation, financial condition and operating results.
+Added: For example, as part of our pervasive AI strategy, we have a portfolio of hardware products and software tools to allow our customers to develop scalable and pervasive AI solutions.
+Added: We are actively building AI capabilities into our products, but there can be no assurance about the rate and pace of adoption of such product offerings.
+Added: In our Data Center segment, we offer products that are optimized for generative AI applications and since the fourth quarter of 2023, we have experienced significant demand for our AI accelerators.
+Added: The demand for such products in part will depend on the extent to which our customers utilize generative AI solutions in a wide variety of applications, and both the near-term and long-term trajectory of such generative AI solutions is unknown.
+Added: If we fail to develop and timely offer or deploy such products and technologies, keep pace with the product offerings of our competitors, or adapt to unexpected changes in industry standards or disruptive technological innovation, our business could be adversely affected.
+Added: Additionally, our efforts in developing new AI technology solutions are inherently risky and may not always succeed.
+Added: We may incur significant costs, resources, investments and delays and not achieve a return on investment or capitalize on the opportunities presented by demand for AI solutions.
+Added: Moreover, while AI adoption is likely to continue and may accelerate, the long-term trajectory of this technological trend is uncertain.
+Added: Delays in developing, qualifying or shipping new products can also cause us to miss our customers’ product design windows or, in some cases, breach contractual obligations.
+Added: If our customers do not include our products in the initial design of their computer systems or products, they will typically not use our products in their systems or products until at least the next design configuration.
+Added: The process of being qualified for inclusion in a customer’s system or product can be lengthy and could cause us to further miss a cycle in the demand of end-users, which also could result in a loss of market share and harm our business.
+Added: We also depend on the success and timing of our customers’ platform launches.
+Added: If our customers delay their product launches or if our customers do not effectively market their platforms with our products, it could result in a delay in bringing our products to market and cause us to miss a cycle in the demand of end-users, which could materially adversely affect our business.
+Added: The increasing frequency and complexity of our newly introduced products may result in unanticipated quality or production issues that could result in product delays.
+Added: In addition, market demand requires that products incorporate new features and performance standards on an industry-wide basis.
+Added: Over the life of a specific product, the sale price is typically reduced over time.
+Added: The introduction of new products and enhancements to existing products is necessary to maintain the overall corporate average selling price.
+Added: If we are unable to introduce new products with sufficiently high sale prices or to increase unit sales volumes capable of offsetting the reductions in the sale prices of existing products over time, our business could be materially adversely affected.
The loss of a significant customer may have a material adverse effect on us.
−Removed: We depend on a small number of customers for a substantial portion of our business and we expect that a small number of customers will continue to account for a significant part of our revenue in the future.
−Removed: If one of our key customers decides to stop buying our products, materially reduces its operations or its demand for our products, or has operations that are materially impaired for a significant period of time such that it is unable to receive or utilize our products, our business would be materially adversely affected.
−Removed: We are subject to risks associated with public health crises, such as pandemics and epidemics, including the COVID-19 pandemic, which may have a material adverse effect on our business.
−Removed: We are subject to risks associated with public health crises, such as pandemics and epidemics, which may have a material adverse effect on our business.
−Removed: Global health outbreaks, such as COVID-19, have and may continue to adversely affect our employees, disrupt our business operations and practices, as well those of our customers, partners, vendors and suppliers.
−Removed: Public health measures by government authorities such as travel bans, social-distancing, lockdown measures, vaccination requirements may cause us to incur additional costs, limit our operations, modify our business practices, diminish employee productivity or disrupt our supply chain, which may have a material adverse effect on our business.
−Removed: To the extent a public health crisis will impact our business, financial condition and results of operations depends on factors outside of our control, including severity, duration and the measures to contain the health outbreak.
−Removed: The markets in which our products are sold are highly competitive.
−Removed: The markets in which our products are sold are highly competitive and delivering the latest and best products to market on a timely basis is critical to achieving revenue growth.
−Removed: We believe that the main factors that determine our product competitiveness are total cost of ownership, timely product introductions, product quality, product features and capabilities (including accelerations for key workloads such as artificial intelligence (AI)), energy efficiency relating to power consumption and battery life given their impact on total cost of ownership, reliability, processor clock speed, performance, size (or form factor), selling price, cost, adherence to industry standards (and the creation of open industry standards), level of integration, software and hardware compatibility, ease of use and functionality of software design tools, completeness of applicable software solutions, security and stability, brand recognition and availability.
−Removed: We expect that competition will continue to be intense due to rapid technological changes, frequent product introductions by our competitors or new competitors of products that may provide better performance/experience or that may include additional features that render our products comparatively less competitive.
−Removed: We may also face aggressive pricing by competitors, especially during challenging economic times.
−Removed: In addition, our competitors have significant marketing and sales resources which could increase the competitive environment in a declining market or during challenging economic times, leading to lower prices and margins.
−Removed: Some competitors may have greater access or rights to complementary technologies, including interface, processor and memory technical information.
−Removed: For instance, with our APU products and other competing solutions with integrated graphics, we believe that demand for additional discrete graphics chips and cards may decrease in the future due to improvements in the quality and performance of integrated graphics.
−Removed: If competitors introduce competitive new products into the market before us, demand for our products could be adversely impacted and our business could be adversely affected.
−Removed: In addition, Intel is expanding its position in integrated graphics for the PC market with high-end discrete graphics solutions for a broad range of computing markets, which may negatively impact our ability to compete in these computing markets, and Nvidia has added an ARM CPU offering which adds competition in the CPU market.
−Removed: Also, increased adoption of ARM-based semiconductor designs could lead to further growth and development of the ARM ecosystem.
−Removed: While we see significant opportunity in AI, we expect intense competition from companies such as Nvidia in the supply of GPUs and other accelerators for the AI market.
−Removed: In addition, we are entering markets with current and new competitors who may be able to adapt more quickly to customer requirements and emerging technologies.
−Removed: We cannot guarantee that we will be able to compete successfully against current or new competitors who may have stronger positions in these new markets or superior ability to anticipate customer requirements and emerging industry trends.
−Removed: Furthermore, we may face competition from some of our customers who internally develop the same products as us.
−Removed: We may face delays or disruptions in research and development efforts, or we may be required to invest significantly greater resources in research and development than anticipated.
−Removed: Also, the semiconductor industry has seen several mergers and acquisitions over the last number of years.
−Removed: Further consolidation could adversely impact our business due to there being fewer suppliers, customers and partners in the industry.
−Removed: From time to time, governments provide incentives or make other investments that could benefit and give a competitive advantage to our competitors.
−Removed: For example, the United States government enacted the Creating Helpful Incentives to Produce Semiconductors for America and Science Act (CHIPS Act) of 2022 to provide financial incentives to the U.S.
−Removed: semiconductor industry.
−Removed: Government incentives, including the CHIPS Act, may not be available to us on acceptable terms or at all.
−Removed: If our competitors can benefit from such government incentives and we cannot, it could strengthen our competitors’ relative position and have a material adverse effect on our business.
+Added: We depend on a small number of customers for a substantial portion of our business, and we expect that a small number of customers will continue to account for a significant part of our revenue and receivables in the future.
+Added: If one of our key customers decides to stop buying our products, materially reduces its operations or its demand for our products, or has operations that are materially impaired for a significant period of time such that it is unable to receive or utilize our products, or pay its liabilities, our business would be materially adversely affected.
+Added: Economic and market uncertainty may adversely impact our business and operating results.
+Added: Uncertain global or regional economic conditions have and may in the future adversely impact our business.
+Added: Uncertainty in the economic environment or other unfavorable changes in economic conditions, such as inflation, higher interest rates, recession, slowing growth, increased unemployment, tighter credit markets, changes in fiscal monetary or trade policy, or currency fluctuations, may negatively impact consumer confidence and spending causing our customers to stop or postpone purchases.
+Added: For example, our Embedded segment revenue decreased in 2024 as customers continued to normalize their inventory levels.
+Added: During challenging economic times, our current or potential future customers may experience cash flow problems and as a result may modify, delay or cancel plans to purchase our products.
+Added: Additionally, if our customers are not successful in generating sufficient revenue or are unable to secure financing, they may not be able to pay, or may delay payment of, accounts receivable that they owe us.
+Added: The risk related to our customers potentially defaulting on or delaying payments to us is increased because we expect that a small number of customers will continue to account for a substantial part of our revenue.
+Added: Any inability of our current or potential future customers to pay us for our products may adversely affect our earnings and cash flow.
+Added: Moreover, our key suppliers may reduce their output or become insolvent, thereby adversely impacting our ability to manufacture our products.
+Added: Adverse changes in economic conditions could increase costs of memory, equipment, materials or substrates and other supply chain expenses.
+Added: If we are not able to procure a stable supply of materials on an ongoing basis and at reasonable costs to meet our production requirements, we could experience a supply shortage or an increase in production costs, which could negatively impact our gross margin and materially adversely affect our business.
+Added: Our ability to forecast our operating results, make business decisions and execute our business strategy could be adversely impacted by challenging macroeconomic conditions.
+Added: In addition, uncertain economic conditions could lead to higher borrowing costs and reduced availability of capital and credit markets, making it more difficult for us to raise funds through borrowings or private or public sales of debt or equity securities.
+Added: An economic downturn or increased uncertainty could also lead to failures of counterparties including financial institutions and insurers, asset impairments and declines in the value of our financial instruments.
+Added: If a banking institution in which we hold funds fails or is subject to significant adverse conditions in the financial or credit markets, we could be subject to a risk of loss of all or a portion of such uninsured funds or be subject to a delay in accessing all or a portion of such uninsured funds, which in turn could adversely impact our short-term liquidity and ability to meet our operating expense obligations.
Our operating results are subject to quarterly and seasonal sales patterns.
45 unchanged sentences
They could choose to prioritize capacity for other customers, increase the prices that they charge us on short notice, require onerous prepayments, or reduce or eliminate deliveries to us, which could have a material adverse effect on our business.
+Added: If we overestimate our customer demand or experience a decrease in customer demand, either could result in excess inventory and an increase in our production costs.
+Added: We are party to a wafer supply agreement with GF where GF will provide a minimum annual capacity allocation to us and set pricing through 2026.
+Added: If our actual wafer requirements are less than the number of wafers required to meet the applicable annual wafer purchase target, we could have excess inventory or higher inventory unit costs, both of which may adversely impact our gross margin and our results of operations.
Other risks associated with our dependence on third-party manufacturers include limited control over delivery schedules, yield, cycle times, quality assurance, price increases, lack of capacity in periods of excess demand, misappropriation of our intellectual property, dependence on several subcontractors, and limited ability to manage inventory and parts.
Moreover, if any of our third-party manufacturers (or their subcontractors) suffer any damage to facilities, lose benefits under material agreements, experience power outages, water shortages, or high heat events, lack sufficient capacity to manufacture our products, encounter financial difficulties, are unable to secure necessary raw materials from their suppliers, suffer any other disruption or reduction in efficiency, or experience uncertain environmental, social, atmospheric or natural, economic or political circumstances or conditions, we may encounter supply delays or disruptions.
−Removed: If we are unable to secure sufficient or reliable supplies of products, our ability to meet customer demand may be adversely affected and this could materially affect our business.
+Added: For example, in the first quarter of 2024, we experienced some inventory loss due to an incident at a contract manufacturer.
+Added: If we are unable to secure sufficient or reliable supply of products, our ability to meet customer demand may be adversely affected and this could materially affect our business.
If we transition the production of some of our products to new manufacturers, we may experience delayed product introductions, lower yields or poorer performance of our products.
1 unchanged sentence
We could experience significant delays in the shipment of our products if we are required to find alternative third-party manufacturers, which could have a material adverse effect on our business.
−Removed: We are a party to a wafer supply agreement (WSA) with GF that governs the terms by which we purchase products manufactured by GF and this agreement is in place through 2025.
−Removed: GF will provide a minimum annual capacity allocation to us through 2025 and we have corresponding annual wafer purchase targets.
−Removed: If we do not meet the annual wafer purchase target, we will be required to pay to GF a portion of the difference between the actual wafer purchases and the wafer purchase target for such year.
−Removed: AMD and GF also have agreed to wafer pricing through 2025.
−Removed: We do not have any exclusivity commitments with GF, and we have full flexibility to contract with any wafer foundry with respect to all products manufactured at any technology node.
−Removed: If our actual wafer requirements are less than the number of wafers required to meet the applicable annual wafer purchase target, we could have excess inventory or higher inventory unit costs, both of which may adversely impact our gross margin and our results of operations.
−Removed: If GF fails to meet its minimum annual capacity allocation obligations, we could experience significant delays in the shipment of our products, which could have a material adverse effect on our business.
We are party to two ATMP joint ventures (collectively, the ATMP JVs) with affiliates of Tongfu Microelectronics Co., Ltd.
2 unchanged sentences
If essential equipment, materials, substrates or manufacturing processes are not available to manufacture our products, we could be materially adversely affected.
−Removed: We may purchase equipment, materials and substrates for use by our back-end manufacturing service providers from a number of suppliers and our operations depend upon obtaining deliveries of adequate supplies of equipment and materials on a timely basis.
−Removed: Our third-party suppliers also depend on the same timely delivery of adequate quantities of equipment and materials in the manufacture of our products.
+Added: We may purchase equipment, materials and substrates for use by our back-end manufacturing service providers from a number of suppliers and our operations depend upon obtaining deliveries of adequate supplies of equipment and materials of acceptable quality on a timely basis.
+Added: Our third-party suppliers also depend on the same timely delivery of adequate quantities of equipment and materials of acceptable quality in the manufacture of our products.
In addition, as many of our products increase in technical complexity, we rely on our third-party suppliers to update their processes in order to continue meeting our back-end manufacturing needs.
2 unchanged sentences
Similarly, certain non-proprietary materials or components such as memory, printed circuit boards (PCBs), interposers, substrates and capacitors used in the manufacture of our products are currently available from only a limited number of suppliers.
−Removed: If we are unable to procure a stable supply of memory, equipment, materials or substrates on an ongoing basis and at reasonable costs to meet our production requirements, we could experience a shortage in memory, equipment, materials or substrate supply or an increase in production costs, which could have a material adverse effect on our business.
+Added: If we are unable to procure a stable supply of memory, equipment, materials or substrates of acceptable quality on an ongoing basis and at reasonable costs to meet our production requirements, we could experience a shortage in memory, equipment, materials or substrate supply or an increase in production costs, which could have a material adverse effect on our business.
We have long-term purchase commitments and prepayment arrangements with some of our suppliers.
If the delivery of such supply is delayed or does not occur for any reason, it could materially impact our ability to procure and process the required volume of supply to meet customer demand.
−Removed: Conversely, a decrease in customer demand could result in excess inventory and an increase in our production costs, particularly since we have prepayment arrangements with certain suppliers.
+Added: Conversely, if we overestimate our customer demand or experience a decrease in customer demand, either because customers cancel orders or choose to purchase from our competitors, it could result in excess inventory and an increase in our production costs, particularly since we have prepayment arrangements with certain suppliers.
Because some of the equipment and materials that we and our third-party manufacturers purchase are complex, it is sometimes difficult to substitute one equipment or materials supplier for another.
From time to time, suppliers may extend lead times, limit supply or increase prices due to capacity constraints or other factors.
−Removed: Also, some of these materials and components may be subject to rapid changes in price and availability.
+Added: Also, some of these materials and components may be subject to rapid changes in price, quality and availability.
Interruption of supply or increased demand in the industry could cause shortages and price increases in various essential materials.
13 unchanged sentences
Any decrease in manufacturing yields could result in an increase in per unit costs, which would adversely impact our gross margin and/or force us to allocate our reduced product supply amongst our customers, which could harm our relationships and reputation with our customers and materially adversely affect our business.
−Removed: The success of our business is dependent upon our ability to introduce products on a timely basis with features and performance levels that provide value to our customers while supporting and coinciding with significant industry transitions.
−Removed: Our success depends to a significant extent on the development, qualification, implementation and acceptance of new product designs and improvements that provide value to our customers.
−Removed: Our ability to develop, qualify and distribute, and have manufactured, new products and related technologies to meet evolving industry requirements, at prices acceptable to our customers and on a timely basis, are significant factors in determining our competitiveness in our target markets.
−Removed: We cannot assure you that our efforts to execute our product roadmap will result in innovative products and technologies that provide value to our customers.
−Removed: If we fail to or are delayed in developing, qualifying or shipping new products or technologies that provide value to our customers and address these new trends or if we fail to predict which new form factors, product features preferences or requirements, consumers will adopt and adjust our business accordingly, we may lose competitive positioning, which could cause us to lose market share and require us to discount the selling prices of our products.
−Removed: Although we make substantial investments in research and development, we cannot be certain that we will be able to develop, obtain or successfully implement new products and technologies on a timely basis or that they will be well-received by our customers.
−Removed: Moreover, our investments in new products and technologies involve certain risks and uncertainties and could disrupt our ongoing business.
−Removed: New investments may not generate sufficient revenue, may incur unanticipated liabilities and may divert our limited resources and distract management from our current operations.
−Removed: We cannot be certain that our ongoing investments in new products and technologies will be successful, will meet our expectations and will not adversely affect our reputation, financial condition and operating results.
−Removed: For example, as part of our Pervasive AI strategy, we have a portfolio of hardware products and software tools to allow our customers to develop scalable and pervasive AI solutions.
−Removed: We are increasingly building AI capabilities into our products, but if we fail to develop and timely offer such products and technologies or keep pace with the product offerings of our competitors, our business could be adversely affected.
−Removed: Additionally, our efforts in developing new AI technology solutions are inherently risky and may not always succeed.
−Removed: We may incur significant costs, resources, investments and delays and not achieve a return on investment or capitalize on the opportunities presented by demand for AI solutions.
−Removed: Moreover, while AI adoption is likely to continue and may accelerate, the long-term trajectory of this technological trend is uncertain.
−Removed: Delays in developing, qualifying or shipping new products can also cause us to miss our customers’ product design windows or, in some cases, breach contractual obligations or cause us to pay penalties.
−Removed: If our customers do not include our products in the initial design of their computer systems or products, they will typically not use our products in their systems or products until at least the next design configuration.
−Removed: The process of being qualified for inclusion in a customer’s system or product can be lengthy and could cause us to further miss a cycle in the demand of end-users, which also could result in a loss of market share and harm our business.
−Removed: We also depend on the success and timing of our customers’ platform launches.
−Removed: If our customers delay their product launches or if our customers do not effectively market their platforms with our products, it could result in a delay in bringing our products to market and cause us to miss a cycle in the demand of end-users, which could materially adversely affect our business.
−Removed: In addition, market demand requires that products incorporate new features and performance standards on an industry-wide basis.
−Removed: Over the life of a specific product, the sale price is typically reduced over time.
−Removed: The introduction of new products and enhancements to existing products is necessary to maintain the overall corporate average selling price.
−Removed: If we are unable to introduce new products with sufficiently high sale prices or to increase unit sales volumes capable of offsetting the reductions in the sale prices of existing products over time, our business could be materially adversely affected.
Our revenue from our semi-custom SoC products is dependent upon our semi-custom SoC products being incorporated into customers’ products and the success of those products.
19 unchanged sentences
While we and others have implemented various controls and defenses, AMD and companies like AMD and our vendors and customers have been and are increasingly subject to cybersecurity attacks, risks and threats.
−Removed: Threat actors range in sophistication from individual hackers and insiders to ransom gangs and state-sponsored attackers.
+Added: Threat factors range in sophistication from individual hackers and insiders to ransom gangs and state-sponsored attackers.
Cyber threats may be generic, or they may be custom-crafted against our IT Systems or supply chain.
1 unchanged sentence
Our IT Systems and Confidential Data are vulnerable to a range of cybersecurity risks and threats, including malicious code that is added to widely available open-source software, compromised commercial software or security vulnerabilities in our products or systems, or those of a third party, that are being used by attackers prior to mitigations being put in place, such as zero-day attacks.
−Removed: Cyberattacks have and may come into our IT Systems through the compromise of user’ access credentials.
+Added: Cyberattacks have and may come into our IT Systems through the compromise of users’ access credentials.
Users’ access credentials can be compromised by phishing, vishing, smishing, multi-factor authentication (MFA) prompt bombing, hacking, or other social engineering, cybersecurity, or theft activities.
−Removed: Threat actors are also increasingly using tools and techniques that circumvent controls, evade detection, and remove forensic evidence, which means that we and others may be unable to anticipate, detect, deflect, contain or recover from cyberattacks in a timely or effective manner.
−Removed: As AI capabilities improve and are increasingly adopted, we may see cyberattacks created through AI.
+Added: Threat actors are also increasingly using tools and techniques that circumvent controls, evade detection, and remove forensic evidence, which means that we and others may be unable to implement adequate preventative measures against, anticipate, detect, deflect, contain or recover from cyberattacks in a timely or effective manner.
+Added: As AI capabilities improve and are increasingly adopted, we may see more sophisticated threats created through the use of AI technology to launch more automated, targeted and coordinated cyberattacks.
These attacks could be crafted with an AI tool to directly attack IT Systems with increased speed and/or efficiency than a human threat actor or create more effective phishing emails.
14 unchanged sentences
and complying with external regulations.
−Removed: We may encounter difficulties in operating our newly upgraded enterprise resource planning system, which could materially adversely affect us.
−Removed: We have recently upgraded our enterprise resource planning (ERP) system to help us manage our operations and financial reporting.
−Removed: Our newly upgraded ERP system may not operate as we expect it to and may cause disruption to our operations, which could have a material adverse effect on our business.
−Removed: Difficulties that may occur in connection with operating our newly upgraded ERP system include disruptions to business continuity, administrative or technical problems, difficulty in maintaining effective internal controls, and interruptions or delays to our sales processes.
−Removed: Any of these events could have an adverse effect on our business, operating results and financial condition.
Uncertainties involving the ordering and shipment of our products could materially adversely affect us.
7 unchanged sentences
In addition, our customers may change their inventory practices on short notice for any reason.
−Removed: For example, our Client segment revenue decreased due to a decline in the PC market in the second half of 2022 and the first half of 2023, and our Embedded segment revenue decreased as a result of an inventory correction in several end markets in the second half of 2023.
+Added: For example, our Embedded segment revenue decreased in 2024 as customers continued to normalize their inventory levels.
We may build inventories during periods of anticipated growth, and the cancellation or deferral of product orders or overproduction due to failure of anticipated orders to materialize could result in excess or obsolete inventory, which could result in write-downs of inventory and an adverse effect on gross margins.
Our customers may also experience a shortage of, or delay in receiving certain components to build their products, which in turn may affect the demand for or the timing of our products.
−Removed: For instance, OEMs have and continue to experience industry-wide challenges securing matched component sets to build their products.
Excess or obsolete inventory have resulted in, and may in the future result in, write-downs of the value of our inventory.
−Removed: For example, in the third quarter of 2022, we recorded certain charges primarily for inventory, pricing and related reserves in the Gaming and Client segments.
Factors that may result in excess or obsolete inventory, a reduction in the average selling price, or a reduction in our gross margin include:
6 unchanged sentences
In the design and development of new and enhanced products, we rely on third-party intellectual property such as development and testing tools for software and hardware.
−Removed: Furthermore, certain product features may rely on intellectual property acquired from third parties that incorporate into our software or hardware.
+Added: Furthermore, certain product features may rely on intellectual property acquired from third parties that we incorporate into our software or hardware.
The design requirements necessary to meet customer demand for more features and greater functionality from semiconductor products may exceed the capabilities of the third-party intellectual property or development or testing tools available to us.
1 unchanged sentence
We depend on third-party companies for the design, manufacture and supply of motherboards, software, memory and other computer platform components to support our business and products.
−Removed: We depend on third-party companies for the design, manufacture and supply of motherboards, graphics cards, software (e.g., BIOS, operating systems, drivers), memory and other components that we use to design, support and sell, and our customers utilize to support and/or use our product offerings.
+Added: We depend on third-party companies for the design, manufacture and supply of motherboards, graphics cards, software (e.g., BIOS, operating systems, drivers, AI models or tools), memory and other components that we use to design, support and sell, and our customers utilize to support and/or use our product offerings.
We also rely on our AIB partners to support our products.
21 unchanged sentences
In the event of a significant decline in the price of our products, the price protection rights we offer would materially adversely affect us because our revenue and corresponding gross margin would decline.
−Removed: Our business is dependent upon the proper functioning of our internal business processes and information systems and modification or interruption of such systems may disrupt our business, processes and internal controls.
+Added: Our business depends on the proper functioning of our internal business processes and information systems and modification or interruption of such systems may disrupt our business, processes and internal controls.
We rely upon a number of internal business processes and information systems to support key business functions, and the efficient operation of these processes and systems is critical to our business.
35 unchanged sentences
We market and sell our products directly to OEMs and through authorized third-party distributors.
−Removed: From time to time, our products are diverted from our authorized distribution channels and are sold on the “gray market.” Gray market products result in shadow inventory that is not visible to us, thus making it difficult to forecast demand accurately.
+Added: From time to time, our products are diverted from our authorized distribution channels and are sold on the “gray market.” Our inability to control gray market activities could result in customer satisfaction issues because any time products are purchased outside our authorized distribution channels there is a risk that our customers are buying counterfeit or substandard products, including products that may have been altered, mishandled or damaged, or are used products represented as new.
+Added: Additionally, products acquired on the gray market or through other unauthorized channels are at higher risk of being re-sold to prohibited end-users, misused, and deployed for uses that do not align with AMD’s ethics, values or compliance standards.
+Added: Gray market products result in shadow inventory that is not visible to us, making it difficult to forecast demand accurately.
Also, when gray market products enter the market, we and our distribution channels compete with these heavily discounted gray market products, which adversely affects demand for our products and negatively impacts our margins.
−Removed: In addition, our inability to control gray market activities could result in customer satisfaction issues because any time products are purchased outside our authorized distribution channels there is a risk that our customers are buying counterfeit or substandard products, including products that may have been altered, mishandled or damaged, or are used products represented as new.
Climate change may have a long-term impact on our business.
Climate change may have an adverse impact on our business and the business of our suppliers and customers.
−Removed: Global climate change may result in certain natural disasters and climate-related events occurring with increasing frequency and severity and its physical impact on the U.S., China and other major regions where we have operations has the potential to disrupt our business and those of our customers and suppliers.
−Removed: Our headquarters and some of our operations and facilities are located in areas that are susceptible to earthquakes and tsunamis, wildfires, extreme storms, extreme heat, drought, freezing and other natural disasters.
+Added: Global climate change may result in certain natural disasters and climate-related events occurring with increasing frequency and severity and its physical impact on the major regions where we have operations has the potential to disrupt our business and those of our customers and suppliers.
+Added: Our headquarters and some of our operations and facilities are located in areas that are susceptible to earthquakes and tsunamis, wildfires, extreme storms, extreme heat, drought, freezing, tropical cyclones and other natural disasters.
Water and energy availability and reliability in the regions where we have facilities and where our suppliers have operations is important to our business.
−Removed: Certain natural disasters, including drought, wildfires, storms, sea-level rise and flooding could disrupt the availability of water necessary for the operations of our business or those of our suppliers and customers.
−Removed: Global climate change may also result in chronic changes that result in certain natural disasters occurring more frequently or with greater intensity, which could disrupt our operations, or the operations of our third parties.
+Added: Certain natural disasters, including drought, wildfires, storms, sea-level rise and flooding could disrupt our operations and our suppliers’ or customers’ operations, including by disrupting, the availability of energy or water necessary for the operations of our business or those of our suppliers and customers.
+Added: Global climate change is also resulting in chronic changes that result in certain natural disasters occurring more frequently or with greater intensity, which could disrupt our operations, or the operations of our third parties.
Such disruptions could cause delays in manufacturing or shipping our products, affect our supply chain and may result in the loss of business, and additional costs to maintain or resume operations, any of which could adversely affect our business and results of operation.
We may also experience contractual disputes relating to supply chain delays resulting from climate change related disruptions, which could result in increased litigation and costs.
−Removed: Data centers depend on access to clean water and reliable energy, thus potential power or water shortages could impair our customer’s ability to expand their data center capacity and consume our products and services.
+Added: Data centers depend on access to clean water and reliable energy, thus potential power or water shortages could impair our customers’ ability to expand their data center capacity and consume our products and services, which in turn could adversely impact our ability to generate revenue.
Although we maintain insurance coverage for a variety of property, casualty, and other risks, the types and amounts of insurance we obtain vary depending on coverage, availability and cost.
1 unchanged sentence
Additionally, our insurance providers may be unable or unwilling to pay a claim.
−Removed: Losses not covered by insurance may be large, which could harm our results of operations and financial condition.
−Removed: Our business and the business of our suppliers and customers may also be subject to further climate-related regulations, contract terms and lawsuits.
−Removed: New increased regulations regarding carbon taxes, greenhouse gas emissions, fuel or energy taxes and other climate-related risks could result in greater costs;
+Added: Losses not covered by insurance may be large, which could materially harm our results of operations and financial condition.
+Added: Our business and the business of our suppliers and customers may also be subject to climate-related regulations, and contract terms, and may be subject to additional regulations and contract terms and lawsuits in the future.
+Added: New increased regulations regarding carbon taxes, greenhouse gas emissions, fuel or energy taxes and other climate-related risks will likely result in greater costs;
for example, as a result of carbon pricing impacts on electrical utilities and/or necessitating that we purchase more renewable energy than otherwise planned.
1 unchanged sentence
The additional compliance costs incurred by our suppliers may be passed on to us and result in greater indirect costs to us.
−Removed: These costs and restrictions could harm our business and results of operations by increasing our expenses, impacting our reputation if there is actual or perceived non-compliance, or requiring us to alter our operations and products.
+Added: These costs and restrictions could materially harm our business and results of operations by increasing our expenses, impacting our reputation if there is actual or perceived non-compliance, or requiring us to alter our operations and products.
The long-term effects of climate change on the global economy and the technology industry are unclear but could be severe.
+Added: Additionally, we are or expect to be subject to various new or proposed climate-related disclosure requirements and we expect to incur costs and resources in order to comply.
+Added: Failure to accurately comply with such reporting obligations may result in enforcement actions, reputational harm or private litigation that could have a material adverse effect on us.
Legal and Regulatory Risks
7 unchanged sentences
In October 2023, BIS issued new requirements for certain advanced computing items that apply to the export of products classified ECCN 3A090 or 4A090 to a party headquartered in, or with an ultimate parent headquartered in, any of Country Groups D1, D4 or D5, including China.
−Removed: These controls prevent us from shipping our AMD Instinct™ MI250, MI300X, MI300A, MI388X integrated circuits and our Versal™ VC2802, VE2802 FPGAs to China, or to customers outside of the United States whose ultimate parent is headquartered in a D5 country (including China), without a license.
−Removed: These controls also require us to file a Notified Advanced Computing (NAC) notification with BIS 25 days before shipping certain Versal VC2602 and VE2602 FPGAs to China, or to customers outside of the United States whose ultimate parent is headquartered in a D5 country (including China).
−Removed: In December 2023, BIS published a series of frequently asked questions indicating an intent to revise certain sections of the controls issued in October.
−Removed: Such revisions may bring certain other products including the AMD Instinct MI210 into the NAC notification requirement.
+Added: These controls prevent us from shipping certain AMD Instinct™ integrated circuits and certain AMD Versal™ FPGAs to China, or to customers outside of the United States whose ultimate parent is headquartered in a D5 country (including China), without a license.
+Added: These controls also require us to file a Notified Advanced Computing (NAC) notification with BIS 25 days before shipping certain Versal FPGAs to China, or to customers outside of the United States whose ultimate parent is headquartered in a D5 country (including China).
The NAC notification process could result in BIS prohibiting a shipment or requiring a license application before shipping a product that is the subject of a NAC notification.
5 unchanged sentences
In addition, deemed export restrictions could further affect our ability to provide services or develop products in the United States.
+Added: United States export control regulations include restrictions or prohibitions on the sale or supply of certain AI technologies to United States embargoed or sanctioned countries, governments, persons and entities.
+Added: If there are changes to those regulations, or to the categorization of our products under those regulations, our ability to sell our products and services outside the United States may be harmed.
+Added: The United States and its allies continue to focus on export restrictions targeting semiconductors associated with AI, including GPUs and associated products and services.
+Added: The United States has imposed unilateral controls restricting GPUs and associated products, and in the future is likely to further adopt other unilateral or multilateral controls.
+Added: The scope and application of such controls have been and may again be very broad, which may prohibit us from exporting or providing access to our products to any or all customers in one or more markets, including but not limited to China, and could negatively impact our manufacturing, testing and warehousing locations, or could impose other conditions that limit our ability to meet demand abroad.
+Added: If these export controls targeting semiconductors associated with AI including GPUs and associated products and services are further tightened, our ability to export our technology, products or services could be further restricted.
+Added: We may be at a competitive disadvantage if our competitors are not subject to the same or similar restrictions.
+Added: Additionally, such export controls have, and may in the future, subject downstream recipients of our products to additional restrictions on the use, resale, repair or transfer of our products and may have a material adverse effect on us.
We may, from time to time, receive technical data from third parties that is subject to the International Traffic and Arms Regulations (ITAR), which are administered by the U.S.
21 unchanged sentences
Our future effective tax rates, financial condition and results from operations could be unfavorably affected by changes in the tax rates in jurisdictions where our income is earned, by changes in the tax rules and regulations or the interpretation of tax rules and regulations in the jurisdictions in which we do business or by changes in the valuation of our deferred tax assets.
−Removed: Many countries have started to implement legislation and other guidance to align their international tax rules with the Organization for Economic Co-operation and Development’s (OECD) Base Erosion and Profit Shifting recommendations and action plan that aim to standardize and modernize global corporate tax policy, including changes to cross-border tax, transfer pricing documentation rules, and nexus-based tax incentive practices.
−Removed: The OECD is also continuing discussions surrounding fundamental changes in allocation of profits among tax jurisdictions in which companies do business, as well as the implementation of a global minimum tax (namely the “Pillar One” and “Pillar Two” proposals).
−Removed: The Council of the European Union has adopted the global corporate 15% minimum tax as provided for in Pillar Two and has directed EU member states to implement legislation enacting Pillar Two.
−Removed: Many countries, including non-EU member states, have implemented laws based on Pillar Two proposals, which may materially adversely impact our provision for income taxes, net income and cash flows.
+Added: Many countries have implemented legislation and other guidance to align their international tax rules with the Organization for Economic Co-operation and Development’s (OECD) Base Erosion and Profit Shifting recommendations and action plan that aim to standardize and modernize global corporate tax policy, including changes to cross-border tax, transfer pricing documentation rules, and nexus-based tax incentive practices.
+Added: The OECD is also continuing discussions surrounding fundamental changes in allocation of profits among tax jurisdictions in which companies do business, as well as the implementation of a global minimum tax (namely “Pillar One” and “Pillar Two”).
+Added: Many countries we do business in have implemented laws based on Pillar Two, which may materially adversely impact our provision for income taxes, net income and cash flows.
As a result of this heightened scrutiny, prior decisions by tax authorities regarding treatments and positions of corporate income taxes could be subject to review and inquiry, which could also result in changes in tax policies or existing tax rulings, and may have a material adverse effect on us.
21 unchanged sentences
Even if we were to prevail, any litigation could be costly and time-consuming and would divert the attention of our management and key personnel from our business operations, which could have a material adverse effect on us.
−Removed: We are subject to environmental laws, conflict minerals-related provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act as well as a variety of other laws or regulations that could result in additional costs and liabilities.
+Added: We are subject to environmental laws, conflict minerals regulations, as well as a variety of other laws or regulations that could result in additional costs and liabilities.
Our operations and properties are subject to various United States and foreign laws and regulations, including those relating to materials used in our products and the manufacturing processes of our products, discharge of pollutants into the environment, the treatment, transport, storage and disposal of solid and hazardous wastes and remediation of contamination.
33 unchanged sentences
New emerging technology trends, such as AI, require us to keep pace with evolving regulations and industry standards.
−Removed: Given the complexity and rapid development of AI, there are various current and proposed regulatory frameworks relating to the use of AI in products and services in the U.S.
−Removed: and foreign jurisdictions such as the EU.
−Removed: For example, in the EU, an AI act is being considered.
+Added: Given the complexity and rapid development of AI, there are various current and proposed regulatory frameworks relating to the use of AI in products and services.
+Added: For example, the EU AI Act was adopted in 2024 and its implementation will be phased in over the next few years.
+Added: In other jurisdictions, similar legislation is being considered.
Such laws and regulations may impede our ability to offer certain products and services in certain jurisdictions if we are unable to comply with them.
3 unchanged sentences
There are evolving expectations from governments, investors, customers and other stakeholders regarding corporate responsibility matters including those involving the environment and climate, energy and water consumption, diversity and inclusion, human rights and cybersecurity.
−Removed: This development on corporate responsibility is resulting in increased mandatory and voluntary reporting standards and disclosures.
−Removed: For example, various jurisdictions have adopted or are contemplating adopting legislation and regulations that may impact how we and our suppliers and customers conduct business or report on business by requiring the disclosure and tracking of greenhouse gas emissions, climate change-related risks and other sustainability matters related to our business.
+Added: Additionally, we are and expect to continue to be subject to various new and proposed climate-related and sustainability laws and requirements that may impact how we and our suppliers and customers conduct business or report on business by requiring the disclosure and tracking of greenhouse gas emissions, climate change-related risks and other sustainability matters related to our business.
As the nature, scope and complexity of corporate responsibility reporting and disclosure requirements continue to evolve, we may incur additional compliance costs and indirect compliance costs from our customers and, suppliers that are passed on to us.
−Removed: In addition, certain corporate responsibility legislation and regulation may require us to adapt our business or supply chain in ways that are costly or inefficient.
−Removed: Emerging legal and regulatory requirements, can be unpredictable, are subject to change, and may be difficult for us to comply with given the complexity of our supply chain and our outsourced manufacturing.
−Removed: Our failure to comply, or the appearance of our failure to comply, with these legal and regulatory requirements can result in regulatory penalties, fines and legal liabilities, increase costs, and harm our reputation – any of which could have a material adverse effect on our business, financial condition and results of operation.
−Removed: In addition, while we may at times engage in voluntary initiatives (such as voluntary disclosures, certifications, or targets, among others) or commitments to improve our corporate responsibility profile and/or products or to respond to stakeholder expectations, such initiatives or achievement of such commitments may be costly, may not have the desired effect or may impact our reputation with other stakeholders and have a material adverse effect on our business.
−Removed: We have publicly announced certain corporate responsibility goals spanning multiple topics informed by input from various of our stakeholders, including customers, investors and employees.
−Removed: These goals, which reflect our current plans and aspirations based on known conditions;
−Removed: thus, in the future they may change or may not be achieved.
−Removed: We may not achieve, for instance, our stated 30x25 energy efficiency goal to deliver a 30x increase in energy efficiency by 2025, for our processors and accelerators powering servers for high-performance computing and AI training from a 2020 baseline.
−Removed: We are also pursuing and annually reporting our progress toward a science-based target (aligned with a 1.5˚C scenario) of a 50% absolute reduction in greenhouse gas emissions from our operations (Scope 1 and 2) by 2030, from a 2020 base year.
−Removed: Our achievement of these goals, aspirations and other corporate responsibility initiatives is not certain and is subject to various challenges, risks and expectations such as standards, processes, and methodologies that continue to evolve or emerge.
−Removed: Our progress towards some goals receive third-party limited assurance and not reasonable assurance, or may rely on receipt of others’ information and data that may not be subject to either third-party limited or reasonable assurance.
−Removed: Any failure to achieve such goals (or achieve these goals within the set timeframe) or the perception by stakeholders of such failure to achieve these goals may result in reputational or financial harm.
+Added: In addition, certain corporate responsibility laws and regulations may require us to modify our business or supply chain in ways that are costly or less efficient.
+Added: Emerging legal and regulatory requirements in the various jurisdictions in which we operate, can be unpredictable, are subject to change, and may be difficult for us to comply with given the complexity of our supply chain and our outsourced manufacturing.
+Added: For example, the state of California has passed reporting requirements that will require corporations to report on climate data and these laws include data assurance requirements that entail third-party verifications.
+Added: Our failure to comply, or the appearance of our failure to comply, with these legal and regulatory requirements can result in regulatory penalties, fines and legal liabilities, increase costs, and harm our reputation – any of which could materially adversely affect our business, financial condition and results of operation.
+Added: While we have engaged, and in the future may continue to engage, in voluntary initiatives (such as voluntary disclosures, certifications, goals, or targets, among others) or commitments to improve our corporate responsibility profile and/or products or to respond to stakeholder expectations, such initiatives or achievement of such commitments may be costly, may not have the desired effect or may impact our reputation with other stakeholders and have a material adverse effect on our business.
+Added: For example, we have publicly announced certain corporate responsibility goals spanning multiple topics informed by input from various of our stakeholders, including customers, investors and employees.
+Added: These goals, which reflect our current plans and aspirations based on known conditions, may change in the future or may not be achieved, as they are subject to various challenges, risks and expectations such as standards, processes, and methodologies that continue to evolve or emerge, and many of these matters are outside our control.
+Added: Our progress towards some goals receives third-party limited assurance and not reasonable assurance, or may rely on receipt of others’ information and data that may not be subject to either third-party limited or reasonable assurance.
+Added: Any failure to achieve such goals, failure to achieve these goals within the set timeframe, or in the means expected, or the perception by stakeholders of such failure to achieve these goals may result in reputational or financial harm.
Simultaneously, there are efforts by some stakeholders to reduce companies’ efforts on certain environmental, social and sustainability-related matters.
−Removed: Both advocates and opponents to these matters are increasingly resorting to a range of activism forms, including media campaigns and litigation, to advance their perspectives.
+Added: Both advocates and opponents of environmental, social and sustainability matters are increasingly resorting to a range of activism forms, including media campaigns and litigation, to advance their perspectives.
To the extent we are subject to such activism or litigation, it may require us to incur costs or otherwise adversely impact our business.
−Removed: Additionally, stakeholder groups may find our stated goals to be insufficiently responsive to the implications of issues, such as climate change, and any failure to set or achieve corporate responsibility initiatives that meet stakeholder expectations may result in loss of customers or in investors selling their shares, which could harm our reputation and could have a material adverse effect on our business.
+Added: Stakeholder groups may find our stated goals to be insufficiently responsive to the implications of issues, such as climate change, and any failure to set or achieve corporate responsibility initiatives that meet stakeholder expectations may result in loss of customers or in investors selling their shares, which could harm our reputation and could have a material adverse effect on our business.
Issues related to the responsible use of AI may result in reputational, competitive and financial harm and liability.
We offer products that include capabilities to support AI deployment and we expect this part of our business to grow.
−Removed: As with many new emerging technologies, AI presents risks and challenges and increasing ethical concerns relating to its responsible use that could affect the adoption of AI, and thus our business.
+Added: As with many new emerging technologies, AI presents risks and challenges and increasing legal, social and ethical concerns relating to its responsible use that could affect the adoption of AI, and thus our business.
Third-party misuse of AI applications, models, or solutions, or ineffective or inadequate AI development or deployment practices by us or our customers, could cause harm to individuals or society and impair the public’s acceptance of AI.
−Removed: Moreover, we may be subject to competitive harm, regulatory action and legal liability as a result of new proposed legislation regulating AI, new applications of existing data protection, privacy and intellectual property and other laws.
−Removed: Such regulations could cause us to incur greater compliance costs and could also impact our ability to sell or the ability of our customers and users worldwide to acquire, deploy and use systems that include our AI-related products and services, which could thus require us to change our business practices and could adversely affect our business, financial condition and results of operations.
−Removed: If the AI-related products that we offer have unintended consequences or unintended usage or customization by our customers or are otherwise controversial due to their perceived or actual impact on human rights, privacy, employment or other social, economic or political issues the public’s acceptance of AI may be impaired and may result in reputational and financial harm and liability to our business.
−Removed: Merger, Acquisition and Integration Risks
−Removed: Acquisitions, joint ventures, and/or investments, and the failure to integrate acquired businesses, may fail to materialize their anticipated benefits and could disrupt our business, which could adversely affect our results of operation and financial condition.
−Removed: We have acquired and invested in businesses, and may continue to do so, that offer products, services and technologies that we believe will help expand our product offerings and grow our business in response to changing technologies, customer demands and competitive pressures.
−Removed: Acquisitions or joint ventures include numerous risks including our inability to identify suitable opportunities in a timely manner or on terms acceptable to us;
−Removed: failure to complete a transaction in a timely manner, or at all, due to our inability to obtain required government or other approvals or IP disputes or other litigation;
+Added: Moreover, we may be subject to competitive harm, regulatory action and legal liability as a result of new and proposed legislation regulating AI, as well as new applications of existing data protection, privacy and intellectual property and other laws.
+Added: Such regulations and changes thereto could cause us to incur greater compliance costs, could impact our ability to sell or the ability of our customers and users worldwide to acquire, deploy and use systems that include our AI-related products and services and reduce the number of customers, which could negatively impact our business and financial results.
+Added: As there continues to be an increasing focus on risks related to AI technologies, there may be an increasing focus on regulatory restrictions that target products and services that enable or facilitate AI and that may negatively impact some of our AI-related products and services.
+Added: If the AI-related products that we offer have unintended consequences, infringe intellectual property rights or rights of publicity, or are misused by our customers or are otherwise controversial due to their perceived or actual impact on human rights, privacy, cybersecurity, employment or other social, economic or political issues the public’s acceptance of AI may be impaired and this may also result in reputational, competitive and financial harm and liability to our business.
+Added: The agreements governing our notes, our guarantee of the Assumed Xilinx Notes, and our Revolving Credit Agreement impose restrictions on us that may adversely affect our ability to operate our business.
+Added: The indenture governing our 3.924% Senior Notes due 2032 and 4.393% Senior Notes due 2052 contains various covenants that limit our ability to, among other things:
+Added: create liens on certain assets to secure debt, enter into certain sale and leaseback transactions;
+Added: and consolidate with, merge into or sell, convey or lease all or substantially all of our assets to any other person.
+Added: We unconditionally guarantee, on a senior unsecured basis, Xilinx’s obligations under the Xilinx’s 2.375% Notes due 2030 (the Assumed Xilinx Notes).
+Added: The supplemental indenture governing the Assumed Xilinx Notes also contain various covenants which limit our ability to, among other things, create certain liens on principal property or the capital stock of certain subsidiaries, enter into certain sale and leaseback transactions with respect to principal property, and consolidate or merge with, or convey, transfer or lease all or substantially all our assets, taken as a whole, to another person.
+Added: We also have an unsecured revolving credit facility in the aggregate principal amount of $3.0 billion (Revolving Credit Agreement).
+Added: Our Revolving Credit Agreement contains various covenants which limit our ability to, among other things, incur liens;
+Added: and consolidate or merge or sell our assets as an entirety or substantially as an entirety (in each case, except for certain customary exceptions).
+Added: In addition, our Revolving Credit Agreement requires us to maintain a minimum consolidated interest coverage ratio at the end of each fiscal quarter.
+Added: The agreement governing our convertible notes and our Revolving Credit Agreement contains provisions whereby a payment default or acceleration under certain agreements with respect to other material indebtedness would result in cross defaults under our convertible indenture or the Revolving Credit Agreement and allow note holders or the lenders under our Revolving Credit Agreement to declare all amounts outstanding under certain of our indentures or the Revolving Credit Agreement to be immediately due and payable.
+Added: If the lenders under our Revolving Credit Agreement accelerate the repayment of borrowings, we cannot assure you that we will have sufficient assets to repay those borrowings.
+Added: Also, we enter into sale and factoring arrangements from time to time with respect to certain accounts receivables, which arrangements are non-recourse to us in the event that an account debtor fails to pay for credit-related reasons and are not included in our indebtedness.
+Added: We could become obligated to repurchase such accounts receivables or otherwise incur liability to the counterparties under these arrangements under certain circumstances, such as where a commercial dispute arises between us and an account debtor.
+Added: Merger, Acquisition, Divestiture, and Integration Risks
+Added: Acquisitions, joint ventures, and/or strategic investments, and the failure to integrate acquired businesses, may fail to materialize their anticipated benefits and could disrupt our business, which could adversely affect our results of operation and financial condition.
+Added: We have acquired and invested in businesses, and may continue to do so, that offer products, services and technologies that we believe will help expand our product offerings and services and grow our business in response to changing technologies, customer demands and competitive pressures.
+Added: Acquisitions and joint ventures include numerous risks including, but not limited to:
+Added: our inability to identify suitable opportunities in a timely manner or on terms acceptable to us;
+Added: failure to complete a transaction in a timely manner, or at all;
+Added: inability to obtain, or delay in obtaining, regulatory approvals or IP disputes or other litigation;
difficulty in obtaining financing on terms acceptable to us or at all;
−Removed: or other unforeseen factors.
−Removed: Even if we successfully complete an acquisition or joint venture, we may not be able to realize any of the anticipated benefits in a timely manner or at all for a variety of reasons, including, but not limited to:
+Added: and failure of a transaction to advance our business strategy or other unforeseen factors.
+Added: For example, in August 2024, we completed our acquisition of Silo AI Oy (Silo AI), and we entered into an agreement to acquire ZT Group Int’l, Inc.
+Added: (ZT Systems), which is currently expected to close in the first half of 2025, subject to certain regulatory approvals and other customary closing conditions.
+Added: Our ability to realize any of the anticipated benefits from an acquisition depends on us successfully integrating the acquired business into our business.
+Added: Any acquisitions we may undertake, including Silo AI and ZT Systems, involve certain integration risks and uncertainties including, but not limited to:
difficulty in integrating the technology, systems, products, policies, processes or operations and integrating and retaining the employees including key personnel of the acquired business;
10 unchanged sentences
and difficulties with integrating and upgrading our and the acquired companies’ financial reporting systems.
−Removed: Any one of these factors could have a material adverse effect on our business, financial condition, results of operations, or cash flows.
−Removed: In addition, to complete an acquisition, we may issue equity securities, which would dilute our stockholders’ ownership and could adversely affect the price of our common stock, and/or incur debt, assume contingent liabilities or have amortization expenses and write-downs of acquired assets, which could adversely affect our results of operations.
−Removed: Moreover, we may not adequately assess the risks of new business initiatives and subsequent events may arise that alter the risks that were initially considered.
+Added: If we cannot successfully integrate or are delayed in integrating newly acquired businesses, it could negatively impact our ability to develop or sell new products and impair our ability to grow our business, which could materially adversely affect our financial conditions, results of operations or cash flows.
+Added: Even if the businesses we acquire are successfully integrated, the benefits of such transactions may not be realized within the anticipated time frame or at all.
+Added: To complete an acquisition, as contemplated by our intent to acquire ZT Systems, we may issue equity securities, which would dilute our stockholders’ ownership and could adversely affect the price of our common stock, and/or incur debt, assume contingent liabilities or have amortization expenses and write-downs of acquired assets, which could adversely affect our results of operations.
+Added: We may not adequately assess the risks of new business initiatives and subsequent events may arise that alter the risks that were initially considered.
Acquisitions, joint ventures and other investments involve significant challenges and risks and could impair our ability to grow our business, develop new products or sell our products, which could have a negative impact on our results of operations.
6 unchanged sentences
law pertaining to the Entity List designation.
−Removed: Furthermore, we may at times invest in private companies to further our strategic objectives and to support certain key business initiatives.
−Removed: Many of the instruments that we invest in are non-marketable and illiquid at the time of our initial investment, and we are not always able to achieve a return.
+Added: Furthermore, we invest in both public and private companies to further our strategic objectives and to support certain key business initiatives.
+Added: We invest in early-stage companies that may still be in the process of developing a strategic direction and may not yet generate revenue.
+Added: Many of the equity and debt instruments that we invest in are non-marketable and illiquid at the time of our initial investment, and we are not always able to achieve a return.
+Added: Our ability to realize a return on our investments in private companies typically depends on the company completing a liquidity event, such as a public offering or acquisition.
+Added: Market conditions and events, particularly in periods with economic uncertainty, inflation, volatile public equity markets or unsettled global market conditions, could cause our investments in public companies to expose us to volatility in our results due to changes in market prices and/or impairments.
To the extent any of the companies in which we invest in are not successful, we could recognize an impairment and/or lose all or part of our investment.
+Added: Our investment portfolio is concentrated in specific sectors.
+Added: Adverse developments in one or any of these sectors due to regulatory changes, technology disruptions or market downturns could negatively impact the performance of our investment portfolio.
+Added: Our ability to complete the acquisition of ZT Systems is subject to closing conditions, including the receipt of consents and approvals from government authorities, which may impose conditions that could adversely affect us or cause the acquisition to not be completed.
+Added: Our acquisition of ZT Systems (the Acquisition), which is expected to occur in the first half of 2025, is subject to the satisfaction or waiver of a number of customary conditions as specified in the purchase agreement (the Agreement), including receipt of certain specified required regulatory approvals and the absence of laws or orders restraining the consummation of the Agreement, among others.
+Added: We cannot assure you that we will receive the necessary regulatory approvals at all or in a timely manner or that closing conditions will be satisfied.
+Added: Any delay in completing the Acquisition could cause us to not realize, or to be delayed in realizing, some or all of the benefits we expect to achieve from this transaction.
+Added: Additionally, if the Acquisition is not completed, we may incur significant acquisitions costs that we may be unable to recover, which could negatively affect our business and results of operations.
+Added: We would be required to pay ZT Systems a termination fee of $300 million if the Agreement is terminated in certain circumstances related to the failure to obtain required regulatory approvals.
+Added: We intend to seek a strategic partner to acquire ZT Systems' manufacturing business, and we may not realize the anticipated benefits of this transaction.
+Added: We may not be able to divest the ZT Systems’ manufacturing business on acceptable terms or at all.
+Added: Divestitures involve certain risks and uncertainties such as:
+Added: inability to find potential buyers on favorable terms;
+Added: failure to receive regulatory or governmental approvals, or delay in receiving such approvals;
+Added: restrictions due to regulatory or governmental approval, litigation, contractual terms, or other conditions;
+Added: changes in market conditions or geopolitical conditions affecting the regions or industries in which we or our counterparties operate;
+Added: distraction of management;
+Added: failure to effectively transfer liabilities, contracts, facilities and employees to buyer;
+Added: continued financial obligations and unanticipated liabilities;
+Added: and closing delays.
+Added: Any one of these factors could delay the achievement of our strategic objectives or cause us to incur additional transaction expenses.
Any impairment of our tangible, definite-lived intangible or indefinite-lived intangible assets, including goodwill, may adversely impact our financial position and results of operations.
We account for certain acquisitions, including the Xilinx, Inc.
−Removed: (Xilinx) and Pensando Systems Inc.
−Removed: (Pensando) acquisitions, using the acquisition method of accounting under the provisions of ASC 805, Business Combinations, with AMD representing the accounting acquirer under this guidance.
+Added: (Xilinx), Pensando Systems Inc.
+Added: (Pensando) and Silo AI acquisitions, using the acquisition method of accounting under the provisions of ASC 805, Business Combinations, with AMD representing the accounting acquirer under this guidance.
We record assets acquired, including identifiable intangible assets, and liabilities assumed, at their respective fair values at the acquisition date.
Any excess of the purchase price over the net fair value of such assets and liabilities will be recorded as goodwill.
−Removed: In connection with the Xilinx and Pensando acquisitions, we recorded significant goodwill and other intangible assets on our consolidated balance sheet.
+Added: In connection with the Xilinx, Pensando and Silo AI acquisitions, we recorded significant goodwill and other intangible assets on our Consolidated Balance Sheets.
Indefinite-lived intangible assets, including goodwill, are tested for impairment at least annually, and all tangible and intangible assets including goodwill will be tested for impairment when certain indicators are present.
3 unchanged sentences
A decrease in the long-term economic outlook and future cash flows of our business could significantly impact asset values and potentially result in the impairment of tangible and intangible assets, including goodwill, and may require us to record future impairment charges, which may have a material adverse impact on our financial position and results of operations.
−Removed: Liquidity and Capital Resources Risks
−Removed: The agreements governing our notes, our guarantees of the Assumed Xilinx Notes, and our Revolving Credit Agreement impose restrictions on us that may adversely affect our ability to operate our business.
−Removed: The indenture governing our 3.924% Senior Notes due 2032 and 4.393% Senior Notes due 2052 contains various covenants that limit our ability to, among other things:
−Removed: create liens on certain assets to secure debt, enter into certain sale and leaseback transactions;
−Removed: and consolidate with, merge into or sell, convey or lease all or substantially all of our assets to any other person.
−Removed: Additionally, in connection with the acquisition of Xilinx, we entered into supplemental indentures for the Xilinx’s 2.950% Notes and 2.375% Notes (together, the Assumed Xilinx Notes ), pursuant to which all obligations of Xilinx under the Assumed Xilinx Notes are unconditionally guaranteed on a senior unsecured basis by us.
−Removed: The indentures governing the Assumed Xilinx Notes also contain various covenants which limit our ability to, among other things, create certain liens on principal property or the capital stock of certain subsidiaries, enter into certain sale and leaseback transactions with respect to principal property, and consolidate or merge with, or convey, transfer or lease all or substantially all our assets, taken as a whole, to another person.
−Removed: We also have an unsecured revolving credit facility in the aggregate principal amount of $3.0 billion (Revolving Credit Agreement).
−Removed: Our Revolving Credit Agreement contains various covenants which limit our ability to, among other things, incur liens;
−Removed: and consolidate or merge or sell our assets as an entirety or substantially as an entirety (in each case, except for certain customary exceptions).
−Removed: In addition, our Revolving Credit Agreement requires us to maintain a minimum consolidated interest coverage ratio at the end of each fiscal quarter.
−Removed: The agreement governing our convertible notes and our Revolving Credit Agreement contains provisions whereby a payment default or acceleration under certain agreements with respect to other material indebtedness would result in cross defaults under our convertible indenture or the Revolving Credit Agreement and allow note holders or the lenders under our Revolving Credit Agreement to declare all amounts outstanding under certain of our indentures or the Revolving Credit Agreement to be immediately due and payable.
−Removed: If the lenders under our Revolving Credit Agreement accelerate the repayment of borrowings, we cannot assure you that we will have sufficient assets to repay those borrowings.
−Removed: Our indebtedness could adversely affect our financial position and prevent us from implementing our strategy or fulfilling our contractual obligations.
−Removed: Our total debt principal amount outstanding as of December 30, 2023 was $2.5 billion.
−Removed: Our indebtedness may make it difficult for us to satisfy our financial obligations, including making scheduled principal and interest payments;
−Removed: limit our ability to borrow additional funds for working capital, capital expenditures, acquisitions and general corporate and other purposes;
−Removed: limit our ability to use our cash flow or obtain additional financing for future working capital, capital expenditures, acquisitions or other general corporate purposes;
−Removed: require us to use a substantial portion of our cash flow from operations to make debt service payments;
−Removed: place us at a competitive disadvantage compared to our competitors with relatively less debt;
−Removed: and increase our vulnerability to the impact of adverse economic and industry conditions.
−Removed: We enter into sale and factoring arrangements from time to time with respect to certain accounts receivables, which arrangements are non-recourse to us in the event that an account debtor fails to pay for credit-related reasons, and are not included in our indebtedness.
−Removed: We could become obligated to repurchase such accounts receivables or otherwise incur liability to the counterparties under these arrangements under certain circumstances, such as where a commercial dispute arises between us and an account debtor.
−Removed: We may not be able to generate sufficient cash to meet our working capital requirements.
−Removed: If we cannot generate sufficient revenue and operating cash flow, we may face a cash shortfall and be unable to make all of our planned investments in research and development or other strategic investments.
−Removed: Also, our cash and cash equivalents could be adversely affected if the banking institutions in which we hold our cash and cash equivalents fail.
−Removed: Our ability to generate sufficient cash to meet our working capital requirements will depend on our financial and operating performance, which may fluctuate significantly from quarter to quarter, and is subject to prevailing economic, financial and business conditions along with other factors, many of which are beyond our control.
−Removed: We cannot assure you that we will be able to generate cash flow in amounts sufficient to enable us to meet our working capital requirements.
−Removed: If we are not able to generate sufficient cash flow from operations, we may be required to sell assets or equity, reduce expenditures, refinance all or a portion of our existing debt or obtain additional financing.
−Removed: In addition, our ability to fund research and development expenditures depends on generating sufficient revenue and cash flow from operations and the availability of external financing, if necessary.
−Removed: Our research and development expenditures, together with ongoing operating expenses, will be a substantial drain on our cash flow and may decrease our cash balances.
−Removed: If new competitors, technological advances by existing competitors, or other competitive factors require us to invest significantly greater resources than anticipated in our research and development efforts, our operating expenses would increase.
−Removed: If we are required to invest significantly greater resources than anticipated in research and development efforts without an increase in revenue, our operating results could decline.
−Removed: Our inability to generate sufficient cash from operations may require us to abandon projects or curtail planned investments in research and development or other strategic initiatives.
−Removed: If we curtail planned investments in research and development or abandon projects, our products may fail to remain competitive and our business would be materially adversely affected.
−Removed: We maintain our cash and cash equivalents in accounts at certain banking institutions, and our deposits at these banking institutions may exceed insured limits.
−Removed: If a banking institution in which we hold funds fails or is subject to significant adverse conditions in the financial or credit markets, we could be subject to a risk of loss of all or a portion of such uninsured funds or be subject to a delay in accessing all or a portion of such uninsured funds.
−Removed: Any such loss or lack of access to these funds could adversely impact our short-term liquidity and ability to meet our operating expense obligations.
−Removed: Further, these events may make equity or debt financing more difficult to obtain, and additional equity or debt financing might not be available on reasonable terms, if at all.
General Risks
7 unchanged sentences
We expect that international sales will continue to be a significant portion of total sales in the foreseeable future.
−Removed: The political, legal and economic risks associated with our operations in foreign countries include, without limitation:
+Added: The political, legal and economic risks associated with our worldwide operations include, without limitation:
expropriation;
7 unchanged sentences
changes to macroeconomic conditions, including interest rates, inflation and recession;
−Removed: disruption in air transportation between the U.S.
−Removed: and our overseas facilities;
+Added: transportation restrictions or disruptions;
loss or modification of exemptions for taxes and tariffs;
5 unchanged sentences
Moreover, the Ukraine-Russia and Israel-Hamas conflicts could escalate and expand, which in turn could have negative impacts on the global economy and financial markets.
−Removed: In addition, our worldwide operations (or those of our business partners) could be subject to natural disasters and climate change such as earthquakes, tsunamis, flooding, typhoons, droughts, fires, sea-level rise, extreme heat and volcanic eruptions that disrupt our operations, or those of our manufacturers, vendors or customers.
−Removed: For example, our Santa Clara and San Jose operations are located near major earthquake fault lines in California.
+Added: In addition, our worldwide operations (or those of our business partners) could be subject to natural disasters and climate change such as earthquakes, tsunamis, flooding, tropical cyclones, droughts, fires, sea-level rise, extreme heat and volcanic eruptions that disrupt our operations, or those of our manufacturers, vendors or customers.
+Added: For example, our California operations are located near major earthquake fault lines.
+Added: In April 2024, Taiwan experienced an earthquake where our third-party wafer foundries are located.
We also have operations and employees in regions that have experienced extreme weather such as prolonged heat waves, wildfires and freezing.
2 unchanged sentences
Global climate change also may result in chronic changes that result in certain natural disasters occurring more frequently or with greater intensity, which could disrupt our operations, or the operations of our third parties.
−Removed: There may be conflict or uncertainty in the countries in which we operate, including public health issues (for example, an outbreak of a contagious disease such as COVID-19, avian influenza, measles or Ebola), safety issues, natural disasters, fire, disruptions of service from utilities, nuclear power plant accidents or general economic or political factors.
−Removed: We have experienced, and will continue to experience, disruptions to our business as these measures have, and will continue to have, an effect on our business operations and practices.
−Removed: The United States has been and may continue to be involved in armed conflicts that could have a further impact on our sales and our supply chain.
+Added: There may be conflict or uncertainty in the countries in which we, our customers and suppliers operate, including public health issues, epidemics and pandemics, safety issues, natural disasters, fire, disruptions of service from utilities, nuclear power plant accidents or general economic or political factors.
+Added: Global health outbreaks, such as COVID-19, have and may continue to adversely affect our employees, disrupt our business operations, as well those of our customers and suppliers.
+Added: Public health measures by government authorities may cause us to incur additional costs, limit our operations, modify our business practices, diminish employee productivity or disrupt our supply chain, which may have a material adverse effect on our business.
+Added: has been and may continue to be involved in armed conflicts that could have a further impact on our sales and our supply chain.
The consequences of armed conflict, political instability or civil or military unrest are unpredictable, and we may not be able to foresee events that could have a material adverse effect on us.
6 unchanged sentences
We license certain third-party technologies and tools for the design and production of our products.
−Removed: We report the value of those licenses as other non-current assets on the balance sheet and we periodically evaluate the carrying value of those licenses based on their future economic benefit to us.
+Added: We report the value of those licenses as other non-current assets on the Consolidated Balance Sheets, and we periodically evaluate the carrying value of those licenses based on their future economic benefit to us.
Factors such as the life of the assets, changes in competing technologies, and changes to the business strategy may represent an indicator of impairment.
4 unchanged sentences
If we are not able to continue to attract, train and retain our leadership team and our qualified employees necessary for our business, the progress of our product development programs could be hindered, and we could be materially adversely affected.
−Removed: To help attract, retain and motivate our executives and qualified employees, we use share-based incentive awards such as employee stock options and non-vested share units (restricted stock units).
+Added: We use share-based incentive awards to help attract, retain and motivate our executives and qualified employees.
If the value of such stock awards does not appreciate as measured by the performance of the price of our common stock, or if our share-based compensation otherwise ceases to be viewed as a valuable benefit, our ability to attract, retain and motivate our executives and employees could be weakened, which could harm our results of operations.
11 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.