AMD (
Cautionary Statement
This earnings press release contains forward-looking statements concerning AMD, its ability to deliver non-GAAP profitability and revenue growth; its ability to diversify its business; its targeted and optimal cash, cash equivalents and marketable securities balances; expected OEM introductions of its products and its expected third quarter of 2014 revenue; 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," "would" 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 Corporation's pricing, marketing and rebating programs, product bundling, standard setting, new product introductions or other activities may negatively impact AMD's plans; that AMD will require additional funding and may be unable to raise sufficient capital on favorable terms, or at all; that customers stop buying AMD's products or materially reduce their operations or demand for AMD's products; that AMD 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 AMD's third-party foundry suppliers will be unable to transition AMD's products to advanced manufacturing process technologies in a timely and effective way or to manufacture AMD's products on a timely basis in sufficient quantities and using competitive process technologies; that AMD will be unable to obtain sufficient manufacturing capacity or components to meet demand for its products or will not fully utilize its projected manufacturing capacity needs at GLOBALFOUNDRIES, Inc. (GF) microprocessor manufacturing facilities; that AMD's requirements for wafers will be less than the fixed number of wafers that it agreed to purchase from GF or GF encounters problems that significantly reduce the number of functional die it receives from each wafer; that AMD is unable to successfully implement its long-term business strategy; that AMD inaccurately estimates the quantity or type of products that its customers will want in the future or will ultimately end up purchasing, resulting in excess or obsolete inventory; that AMD is unable to manage the risks related to the use of its third-party distributors and add-in-board (AIB) partners or offer the appropriate incentives to focus them on the sale of AMD's products; that AMD 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 market growth and demand for AMD's products and technologies in light of the product mix that it may have available at any particular time; that global business and economic conditions will not improve or will worsen; that PC market 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 AMD's sales or supply chain. Investors are urged to review in detail the risks and uncertainties in AMD's Securities and Exchange Commission filings, including but not limited to the Quarterly Report on Form 10-Q for the quarter ended March 29, 2014.
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 earnings press release, in addition to GAAP financial results,
AMD has provided non-GAAP financial measures including 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 earnings press
release. AMD 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 earnings press release. AMD 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 AMD believes it assists investors in
comparing AMD'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 the data tables at the
end of this earnings press release for additional AMD data.
(2) Testing conducted by AMD Performance Labs on optimized AMD reference
systems. PC manufacturers may vary configuration yielding different
results. Basemark CL is used to simulate compute performance; AMD A6-
6310 APU scored 21 while the "Haswell U" Pentium part scored 3. AMD
"Larne" reference platform system using AMD A6-6310 APU with AMD Radeon™
R4 Graphics, 2x2048 MBytes of DDR3-1600 RAM, Microsoft Windows 8.1
Single Language, and 13.300.0.0 - 13-Jan-2014 driver. Intel® Pentium®
3556U @ 1.70GHz with Intel® HD Graphics, 2x2048 MBytes of DDR3-1600 RAM,
Microsoft Windows 8.1 Single Language, 10.18.10.3412 - 28-Jan-2014
driver. BMN-11
(3) Testing conducted by AMD Performance Labs on optimized AMD reference
systems. PC manufacturers may vary configuration yielding different
results. Basemark CL is used to simulate compute performance; A4 Micro-
6400T APU scored 13 while the "Bay Trail T" platform scored 4. AMD
"Discovery" reference platform system using AMD A4 Micro-6400T APU with
Radeon™ R6 Graphics, 2048 MBytes of DDR3-
(4) SiSoftware Sandra test details: System Description: AMD FirePro W8100
vs. Nvidia Quadro K5000 - Dell T3610, Intel Xeon E5-1620 v2 @ 3.60 GHz,
8GB DDR3, Seagate HDD 7200RPM, Win7 64-bit SP1, 1920x1080 resolution.
AMD Driver 13.352.1009 | Nvidia Driver 333.11
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Millions except per share amounts and percentages)
Three Months Ended Six Months Ended
------------------------------- --------------------
Jun. 28, Mar. 29, Jun. 29, Jun. 28, Jun. 29,
2014 2014 2013 2014 2013
--------- --------- --------- --------- ---------
Net revenue $ 1,441 $ 1,397 $ 1,161 $ 2,838 $ 2,249
Cost of sales $ 943 910 702 $ 1,853 1,345
--------- --------- --------- --------- ---------
Gross margin $ 498 487 459 985 904
Gross margin % 35% 35% 40% 35% 40%
Research and
development $ 277 279 308 556 620
Marketing, general
and administrative $ 154 156 171 310 350
Amortization of
acquired intangible
assets $ 4 3 4 7 9
Restructuring and
other special
charges, net $ - - 5 - 52
--------- --------- --------- --------- ---------
Operating income
(loss) $ 63 49 (29) 112 (127)
Interest income $ - 1 2 1 3
Interest expense $ (46) (47) (42) (93) (86)
Other expense, net $ (49) (21) (2) (70) (5)
--------- --------- --------- --------- ---------
Loss before income
taxes $ (32) (18) (71) (50) (215)
Provision for income
taxes $ 4 2 3 6 5
--------- --------- --------- --------- ---------
Net loss $ (36) $ (20) $ (74) $ (56) $ (220)
Net loss per share
Basic $ (0.05) $ (0.03) $ (0.10) $ (0.07) $ (0.29)
Diluted $ (0.05) $ (0.03) $ (0.10) $ (0.07) $ (0.29)
--------- --------- --------- --------- ---------
Shares used in per
share calculation
Basic 764 761 752 762 751
Diluted 764 761 752 762 751
--------- --------- --------- --------- ---------
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Millions)
Three Months Ended Six Months Ended
------------------------------- --------------------
Jun. 28, Mar. 29, Jun. 29, Jun. 28, Jun. 29,
2014 2014 2013 2014 2013
--------- --------- --------- --------- ---------
Total comprehensive
loss $ (32) $ (21) $ (76) $ (53) $ (223)
--------- --------- --------- --------- ---------
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Millions)
--------- --------- ---------
Jun. 28, Mar. 29, Dec. 28,
2014 2014 2013
--------- --------- ---------
Assets
Current assets:
Cash and cash equivalents $ 503 $ 554 $ 869
Marketable securities 445 348 228
Accounts receivable, net 872 840 832
Inventories, net 960 869 884
Prepaid expenses and other current assets 152 79 71
--------- --------- ---------
Total current assets 2,932 2,690 2,884
Long-term marketable securities - 80 90
Property, plant and equipment, net 329 337 346
Acquisition related intangible assets, net 72 75 78
Goodwill 553 553 553
Other assets 360 373 386
--------- --------- ---------
Total Assets $ 4,246 $ 4,108 $ 4,337
========= ========= =========
Liabilities and Stockholders' Equity
Current liabilities:
Short-term debt $ 101 $ 60 $ 60
Accounts payable 511 483 519
Payable to GLOBALFOUNDRIES 295 213 364
Accrued and other current liabilities 480 482 530
Deferred income on shipments to
distributors 118 146 145
--------- --------- ---------
Total current liabilities 1,505 1,384 1,618
Long-term debt 2,109 2,078 1,998
Other long-term liabilities 131 135 177
Stockholders' equity:
Capital stock:
Common stock, par value 8 8 7
Additional paid-in capital 6,905 6,883 6,894
Treasury stock, at cost (114) (114) (112)
Accumulated deficit (6,299) (6,263) (6,243)
Accumulated other comprehensive income
(loss) 1 (3) (2)
--------- --------- ---------
Total stockholders' equity 501 511 544
--------- --------- ---------
Total Liabilities and Stockholders' Equity $ 4,246 $ 4,108 $ 4,337
========= ========= =========
ADVANCED MICRO DEVICES, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Millions)
Three Months Ended Six Months Ended
------------------ ------------------
Jun. 28, Jun. 28,
2014 2014
------------------ ------------------
Cash flows from operating
activities:
Net loss $ (36) $ (56)
Adjustments to reconcile net loss
to net cash used in operating
activities:
Depreciation and amortization 53 106
Employee stock-based
compensation expense 21 44
Non-cash interest expense 3 9
Loss on debt redemptions 49 64
Other (1) (4)
Changes in operating assets and
liabilities:
Accounts receivable (32) (40)
Inventories (90) (76)
Prepaid expenses and other
assets (75) (84)
Payable to GLOBALFOUNDRIES 82 (69)
Accounts payable, accrued
liabilities and other (2) (126)
------------------ ------------------
Net cash used in operating
activities $ (28) $ (232)
------------------ ------------------
Cash flows from investing
activities:
Purchases of property, plant and
equipment (23) (44)
Purchases of available-for-sale
securities (308) (618)
Proceeds from sale and maturity of
available-for-sale securities 288 488
------------------ ------------------
Net cash used in investing
activities $ (43) $ (174)
------------------ ------------------
Cash flows from financing
activities:
Net proceeds from foreign grants
and allowances $ 2 $ 2
Proceeds from issuance of common
stock 1 2
Proceeds from borrowings, net 491 1,080
Repayments of long-term debt and
capital lease obligations (473) (1,042)
Other (1) (2)
------------------ ------------------
Net cash provided by financing
activities $ 20 $ 40
------------------ ------------------
Net decrease in cash and cash
equivalents (51) (366)
------------------ ------------------
Cash and cash equivalents at
beginning of period $ 554 $ 869
------------------ ------------------
Cash and cash equivalents at end of
period $ 503 $ 503
------------------ ------------------
ADVANCED MICRO DEVICES, INC.
SELECTED CORPORATE DATA
(Millions except headcount)
Three Months Ended Six Months Ended
------------------------------------------------------ -----------------
Jun. Mar. Jun. Jun. Jun.
28, 29, 29, 28, 29,
Segment and Category
Information 2014 2014 2013 2014 2013
------------------------------------------------------ -----------------
Computing Solutions (1)
Net revenue $ 669 $ 663 $ 841 $ 1,332 $ 1,592
Operating income (loss) $ 9 $ (3) $ 2 $ 6 $ (37)
Graphics and Visual
Solutions (2)
Net revenue 772 734 320 1,506 657
Operating income 82 91 - 173 16
All Other (3)
Operating loss (28) (39) (31) (67) (106)
Total
Net revenue $ 1,441 $ 1,397 $ 1,161 $ 2,838 $ 2,249
Operating income (loss) $ 63 $ 49 $ (29) $ 112 $ (127)
------------------------------------------------------ -----------------
Other Data
Depreciation and
amortization, excluding
amortization of acquired
intangible assets $ 49 $ 50 $ 54 $ 99 $ 116
Capital additions $ 23 $ 21 $ 28 $ 44 $ 48
Adjusted EBITDA (4) $ 137 $ 139 $ 54 $ 276 $ 94
Cash, cash equivalents and
marketable securities $ 948 $ 982 $ 1,117 $ 948 $ 1,117
Non-GAAP free cash flow
(5) $ (51) $ (225) $ (63) $ (276) $ (238)
Total assets $ 4,246 $ 4,108 $ 3,897 $ 4,246 $ 3,897
Total debt $ 2,210 $ 2,138 $ 2,047 $ 2,210 $ 2,047
Headcount 10,300 10,397 9,928 10,300 9,928
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