AMD (
Cautionary Statement
This document contains forward-looking statements concerning AMD, its third quarter of 2013 revenue, AMD's ability to expand into new markets and reach new customers; AMD's ability to achieve revenue growth in the third quarter of 2013 compared to the second quarter of 2013 and that such growth will be significant; and AMD's ability to achieve profitability in the third quarter of 2013, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are commonly identified by words such as "believes, "expects," "may," "will," "should," "seeks," "intends," "pro forma," "estimates," "anticipates," "plans," "projects," and other terms with similar meaning. Investors are cautioned that the forward-looking statements in this release are based on current beliefs, assumptions and expectations, speak only as of the date of this release and involve risks and uncertainties that could cause actual results to differ materially from current expectations. Risks include the possibility that Intel Corp.'s pricing, marketing and rebating programs, product bundling, standard setting, new product introductions or other activities may negatively impact the company's plans; the company may be unable to develop, launch and ramp new products and technologies in the volumes that are required by the market at mature yields on a timely basis; that the company's third party foundry suppliers will be unable to transition its products to advanced manufacturing process technologies in a timely and effective way or to manufacture the company's products on a timely basis in sufficient quantities and using competitive technologies; the company will be unable to obtain sufficient manufacturing capacity or components to meet demand for its products; the company's requirements for wafers are less than the fixed number of wafers that it agreed to purchase from GLOBALFOUNDRIES (GF) or GF encounters problems that significantly reduce the number of functional die the company receives from each wafer; that the company is unable to successfully implement its long-term business strategy; that customers stop buying the company's products or materially reduce their operations or demand for the company's products; that the company may be unable to maintain the level of investment in research and development that is required to remain competitive; that there may be unexpected variations in the market growth and demand for its products and technologies in light of the product mix that the company may have available at any particular time or a decline in demand; that the company will require additional funding and may be unable to raise sufficient capital on favorable terms, or at all; that global business and economic conditions will not improve or will worsen; that demand for computers will be lower than currently expected; and the effect of political or economic instability, domestically or internationally, on the company's sales or supply chain. Investors are urged to review in detail the risks and uncertainties in the company's Securities and Exchange Commission filings, including but not limited to the Quarterly Report on Form 10-Q for the quarter ended March 30, 2013.
AMD, the AMD Arrow logo, AMD Opteron, AMD Radeon and combinations thereof, are trademarks of Advanced Micro Devices, Inc. Other names are for informational purposes only and used to identify companies and products and may be trademarks of their respective owner.
(1) In this press release, in addition to GAAP financial results, the
Company has provided non-GAAP financial measures including non-GAAP
gross margin, non-GAAP operating income (loss), non-GAAP net income
(loss) and non-GAAP earnings (loss) per share. These non-GAAP
financial measures reflect certain adjustments as presented in the
tables in this press release. The Company also provided Adjusted
EBITDA and non-GAAP free cash flow as supplemental measures of its
performance. These items are defined in the footnotes to the selected
corporate data tables provided at the end of this press release. The
Company is providing these financial measures because it believes this
non-GAAP presentation makes it easier for investors to compare its
operating results for current and historical periods and also because
the Company believes it assists investors in comparing the Company's
performance across reporting periods on a consistent basis by
excluding items that it does not believe are indicative of its core
operating performance and for the other reasons described in the
footnotes to the selected data tables. Refer to corresponding tables
at the end of this press release for additional AMD data.
(2) AMD GX-415GA scored 209, AMD G-T56N scored 98, and Intel Atom D525
scored 93, based on an average of Sandra Engineering 2011 Dhyrstone,
Sandra Engineering 2011 Whetstone and EEMBC CoreMark Multi-thread
benchmark results. AMD G-T56N system configuration used iBase MI958
motherboard with 4BG DDR3 and integrated graphics. AMD GX-415GA system
configuration used AMD "Larne" Reference Design Board with 4GB [1]
Based on AMD's small core Opteron™ processor Model X1150 vs. Intel®
Atom™ Model S1260, Intel's highest performance small core processor.
Highest density based on cores/rack. Since Opteron X-Series has double
the number of cores of Intel Atom S1200 series, it has the double the
density among small core x86 processors. Most power efficient small
core x86 processor as measured by SPECint®_rate_base2006 estimates
divided by TDP.
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Millions except per share amounts and percentages)
Quarter Ended Six Months Ended
---------------------------- ------------------
Jun. 29, Mar. 30, Jun. 30, Jun. 29, Jun. 30,
2013 2013 2012 2013 2012
-------- -------- -------- -------- --------
Net revenue $ 1,161 $ 1,088 $ 1,413 $ 2,249 $ 2,998
Cost of sales 702 643 775 1,345 2,333
------- -------- -------- -------- --------
Gross margin 459 445 638 904 665
Gross margin % 40% 41% 45% 40% 22%
Research and development 308 312 345 620 713
Marketing, general and
administrative 171 179 212 350 442
Amortization of acquired
intangible assets 4 5 4 9 5
Restructuring and other
special charges, net 5 47 - 52 8
-------- -------- -------- ------- --------
Operating income (loss) (29) (98) 77 (127) (503)
Interest income 2 1 2 3 4
Interest expense (42) (44) (43) (86) (86)
Other income (expense), net (2) (3) (5) (5) (6)
-------- -------- -------- -------- --------
Income (loss) before income
taxes (71) (144) 31 (215) (591)
Provision (benefit) for
income taxes 3 2 (6) 5 (38)
-------- -------- -------- -------- --------
Net income (loss) $ (74) $ (146) $ 37 $ (220) $ (553)
Net income (loss) per share
Basic $ (0.10) $ (0.19) $ 0.05 $ (0.29) $ (0.75)
Diluted $ (0.10) $ (0.19) $ 0.05 $ (0.29) $ (0.75)
-------- -------- -------- -------- --------
Shares used in per share
calculation
Basic 752 749 739 751 737
Diluted 752 749 755 751 737
-------- -------- -------- -------- --------
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Millions)
Quarter Ended Six Months Ended
---------------------------- ------------------
Jun. 29, Mar. 30, Jun. 30, Jun. 29, Jun. 30,
2013 2013 2012 2013 2012
-------- -------- -------- -------- --------
Total comprehensive income
(loss) $ (76) $ (147) $ 36 $ (223) $ (552)
-------- -------- -------- -------- --------
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Millions)
----------- ----------- -----------
Jun. 29, Mar. 30, Dec. 29,
2013 2013 2012
----------- ----------- -----------
Assets
Current assets:
Cash, cash equivalents and
marketable securities $ 968 $ 1,003 $ 1,002
Accounts receivable, net 670 645 630
Inventories, net 711 613 562
Prepaid expenses and other current
assets 109 77 71
----------- ----------- -----------
Total current assets 2,458 2,338 2,265
Long-term marketable securities 149 180 181
Property, plant and equipment, net 402 411 658
Acquisition related intangible
assets, net 87 92 96
Goodwill 553 553 553
Other assets 248 223 247
----------- ----------- -----------
Total Assets $ 3,897 $ 3,797 $ 4,000
=========== =========== ===========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 402 $ 301 $ 278
Payable to GLOBALFOUNDRIES 414 379 454
Accrued liabilities 475 461 489
Deferred income on shipments to
distributors 129 132 108
Current portion of long-term debt
and capital lease obligations 5 5 5
Other current liabilities 26 43 63
----------- ----------- -----------
Total current liabilities 1,451 1,321 1,397
Long-term debt and capital lease
obligations, less current portion 2,042 2,039 2,037
Other long-term liabilities 45 22 28
Stockholders' equity:
Capital stock:
Common stock, par value 7 7 7
Additional paid-in capital 6,848 6,827 6,803
Treasury stock, at cost (110) (109) (109)
Accumulated deficit (6,380) (6,306) (6,160)
Accumulated other comprehensive
loss (6) (4) (3)
----------- ----------- -----------
Total stockholders' equity 359 415 538
----------- ----------- -----------
Total Liabilities and Stockholders'
Equity $ 3,897 $ 3,797 $ 4,000
=========== =========== ===========
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Millions)
Quarter Six Months
Ended Ended
------------ ------------
Jun. 29, Jun. 29,
2013 2013
------------ ------------
Cash flows from operating activities:
Net loss $ (74) $ (220)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization 59 125
Net loss on disposal of property, plant and
equipment (1) 47
Benefit for deferred income taxes - 1
Employee stock-based compensation expense 20 44
Non-cash interest expense 6 12
Other 2 1
Changes in operating assets and liabilities:
Accounts receivable (25) (39)
Inventories (97) (149)
Prepaid expenses and other current assets (35) (42)
Other assets (39) (33)
Payable to GLOBALFOUNDRIES 34 (40)
Accounts payable, accrued liabilities and
other 115 103
------------ ------------
Net cash used in operating activities $ (35) $ (190)
------------ ------------
Cash flows from investing activities:
Purchases of property, plant and equipment (28) (48)
Proceeds from sale of property, plant and
equipment 3 181
Purchases of available-for-sale securities (392) (753)
Proceeds from sale and maturity of available-
for-sale securities 343 593
------------ ------------
Net cash used in investing activities $ (74) $ (27)
------------ ------------
Cash flows from financing activities:
Net proceeds from foreign grants and
allowances 2 2
Proceeds from issuance of common stock 1 2
Repayments of debt and capital lease
obligations (1) (2)
------------ ------------
Net cash provided by financing activities $ 2 $ 2
------------ ------------
Net decrease in cash and cash equivalents (107) (215)
------------ ------------
Cash and cash equivalents at beginning of
period $ 441 $ 549
------------ ------------
Cash and cash equivalents at end of period $ 334 $ 334
------------ ------------
ADVANCED MICRO DEVICES, INC.
SELECTED CORPORATE DATA
(Millions except headcount)
Quarter Ended Six Months Ended
-------------------------------------------------------- -------------------
Segment and Category Jun. 29, Mar. 30, Jun. 30, Jun. 29, Jun. 30,
Information 2013 2013 2012 2013 2012
-------------------------------------------------------- -------------------
Computing Solutions (1)
Net revenue $ 841 $ 751 $ 1,046 $ 1,592 $ 2,249
Operating income
(loss) $ 2 $ (39) $ 82 $ (37) $ 206
Graphics and Visual
Solutions (2)
Net revenue 320 337 367 657 749
Operating income - 16 31 16 65
All Other (3)
Operating loss (31) (75) (36) (106) (774)
Total
Net revenue $ 1,161 $ 1,088 $ 1,413 $ 2,249 $ 2,998
Operating income
(loss) $ (29) $ (98) $ 77 $ (127) $ (503)
-------------------------------------------------------- -------------------
Other Data
Depreciation and
amortization, excluding
amortization of
acquired intangible
assets $ 54 $ 62 $ 61 $ 116 $ 123
Capital additions $ 28 $ 20 $ 39 $ 48 $ 79
Adjusted EBITDA (4) $ 54 $ 40 $ 173 $ 94 $ 394
Cash, cash equivalents
and marketable
securities, including
long-term marketable
securities $ 1,117 $ 1,183 $ 1,759 $ 1,117 $ 1,759
Non-GAAP free cash flow
(5) $ (63) $ (175) $ 42 $ (238) $ 109
Total assets $ 3,897 $ 3,797 $ 5,041 $ 3,897 $ 5,041
Long-term debt and
capital lease
obligations, including
current portion $ 2,047 $ 2,044 $ 2,021 $ 2,047 $ 2,021
Headcount 9,928 9,844 11,737 9,928 11,737
-------------------------------------------------------- -------------------
(1) Computing Solutions segment includes x86 microprocessors, as standalone
devices or as incorporated as an accelerated processing unit (APU),
chipsets, embedded processors and dense servers.
(2) Graphics and Visual Solutions segment includes graphics, video and
multimedia products developed for use in desktop and notebook computers,
including home media PCs, professional workstations and servers as well
as revenue received in connection with semi-custom products and
development and game console royalties.
(3) All Other category includes certain expenses and credits that are not
allocated to any of the operating segments. Also included in this
category are amortization of acquired intangible assets, employee stock-
based compensation expense, net restructuring and other special charges
and a charge related to the limited waiver of exclusivity from
GLOBALFOUNDRIES ("GF").
(4) Reconciliation of GAAP operating income (loss) to Adjusted EBITDA*
Quarter Ended Six Months Ended
---------------------------- ------------------
Jun. 29, Mar. 30, Jun. 30, Jun. 29, Jun. 30,
2013 2013 2012 2013 2012
-------- -------- -------- -------- --------
GAAP operating income
(loss) $ (29) $ (98) $ 77 $ (127) $ (503)
Limited waiver of
exclusivity from GF - - - - 703
Legal settlement - - 5 - 5
Depreciation and
amortization 54 62 61 116 123
Employee stock-based
compensation
expense 20 24 26 44 47
Amortization of
acquired intangible
assets 4 5 4 9 5
Restructuring and
other special
charges, net 5 47 - 52 8
SeaMicro acquisition
costs - - - - 6
-------- -------- -------- -------- --------
Adjusted EBITDA $ 54 $ 40 $ 173 $ 94 $ 394
======== ======== ======== ======== ========
(5) Non-GAAP free cash flow reconciliation**
Quarter Ended Six Months Ended
---------------------------- ------------------
Jun. 29, Mar. 30, Jun. 30, Jun. 29, Jun. 30,
2013 2013 2012 2013 2012
-------- -------- -------- -------- --------
GAAP net cash provided
by (used in)
operating activities $ (35) $ (155) $ 81 $ (190) $ 188
Purchases of
property, plant and
equipment (28) (20) (39) (48) (79)
-------- -------- -------- -------- --------
Non-GAAP free cash
flow $ (63) $ (175) $ 42 $ (238) $ 109
======== ======== ======== ======== ========
* The Company presents Adjusted EBITDA as a supplemental measure of its
performance. Adjusted EBITDA for the Company is determined by adjusting
operating income (loss) for depreciation and amortization, employee
stock-based compensation expense and amortization of acquired intangible
assets. In addition, the Company also included the following adjustments
for the applicable period: for all periods presented, except for the
second quarter of 2012, the Company also included an adjustment for net
restructuring and other special charges; for the second quarter of 2012,
the Company included an adjustment related to a legal settlement with a
third party; and for six months ended June 30, 2012, the Company also
included adjustments for the limited waiver of exclusivity from
GLOBALFOUNDRIES, legal settlement with a third party and costs related
to acquisition of SeaMicro, Inc. The Company calculates and communicates
Adjusted EBITDA in the financial schedules because the Company's
management believes it is of importance to investors and lenders in
relation to its overall capital structure and its ability to borrow
additional funds. In addition, the Company presents Adjusted EBITDA
because it believes this measure assists investors in comparing its
performance across reporting periods on a consistent basis by excluding
items that the Company does not believe are indicative of its core
operating performance. The Company's calculation of Adjusted EBITDA may
or may not be consistent with the calculation of this measure by other
companies in the same industry. Investors should not view Adjusted
EBITDA as an alternative to the GAAP operating measure of operating
income (loss) or GAAP liquidity measures of cash flows from operating,
investing and financing activities. In addition, Adjusted EBITDA does
not take into account changes in certain assets and liabilities as well
as interest and income taxes that can affect cash flows.
** The Company also presents non-GAAP free cash flow in the earnings
release as a supplemental measure of its performance. Non-GAAP free cash
flow is determined by adjusting GAAP net cash provided by (used in)
operating activities for capital expenditures. The Company calculates
and communicates non-GAAP free cash flow in the financial schedules
because the Company's management believes it is of importance to
investors to understand the nature of these cash flows. The Company's
calculation of non-GAAP free cash flow may or may not be consistent with
the calculation of this measure by other companies in the same industry.
Investors should not view non-GAAP free cash flow as an alternative to
GAAP liquidity measures of cash flows from operating activities. The
Company has provided reconciliations within the press release and
financial schedules of these non-GAAP financial measures to the most
directly comparable GAAP financial measures.
