AMD Reports 2014 Third Quarter Results

                                                                            
1.  In this earnings press release, in addition to GAAP financial results,  
    AMD has provided non-GAAP financial measures including non-GAAP         
    operating income, 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.                                                   
                                                                            
2.  Compared to the previous generation of AMD FirePro™ professional        
    graphics.                                                               
                                                                            
3.  AMD FirePro™ S9150 max power is 235W and delivers up to 2.53 TFLOPS peak
    double and up to 5.07 peak single precision floating point performance. 
    Nvidia's highest performing server cards in the market as of June 2014  
    are the Tesla K40, max power of 235W, with up to 1.43 TFLOPS peak double
    and up to 4.29 peak single, and the K10, max power 225W, with up to 4.58
    TFLOPS peak single and 190 GFLOPS peak double precision. Visit          
    
www.nvidia.com/object/tesla-servers.html for Nvidia product  
    specs. FP-97                                                            
                                                                            
                                                                            
ADVANCED MICRO DEVICES, INC.                                                
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS                             
(Millions except per share amounts and percentages)                         
                                                                            
                                Three Months Ended        Nine Months Ended 
                           ----------------------------  ------------------ 
                           Sep. 27,  Jun. 28,  Sep. 28,  Sep. 27,  Sep. 28, 
                             2014      2014      2013      2014      2013   
                                                                            
                           --------  --------  --------  --------  -------- 
                                                                                                                        
Net  revenue                                $    1,429    $    1,441    $    1,461    $    4,267    $    3,710  
                                                                                                                                                        
Cost  of  sales                                      935              943              940    $    2,788          2,285  
                                                                                                                                                        
                                                      --------    --------    --------    --------    --------  
                                                                                                                                                        
Gross  margin                                        494              498              521          1,479          1,425  
                                                                                                                                                        
Gross  margin%                                        35%              35%              36%              35%              38%
                                                                                                                                                        
Research  and  development                278              277              288              834              908  
                                                                                                                                                        
Marketing,  general  and                                                                                                            
  administrative                                  150              154              155              460              505  
                                                                                                                                                        
Amortization  of  acquired                                                                                                        
  intangible  assets                                3                  4                  5                10                14  
                                                                                                                                                        
Restructuring  and  other                                                                                                          
  special  charges  (gains),                                                                                                      
  net                                                            -                  -              (22)                -                30  
                                                                                                                                                        
                                                      --------    --------    --------    --------    --------  
                                                                                                                                                        
Operating  income  (loss)                    63                63                95              175              (32)
                                                                                                                                                        
Interest  income                                      1                  -                  1                  2                  4  
Interest  expense                                (43)            (46)            (47)          (136)          (133)
Other  income  (expense),                                                                                                          
  net                                                          (2)            (49)                2              (72)              (3)
                                                                                                                                                        
                                                      --------    --------    --------    --------    --------  
                                                                                                                                                        
Income  (loss)  before                                                                                                                
  income  taxes                                        19              (32)              51              (31)          (164)
                                                                                                                                                        
Provision  for  income  taxes                2                  4                  3                  8                  8  
                                                                                                                                                        
                                                      --------    --------    --------    --------    --------  
                                                                                                                                                        
Net  income  (loss)                    $          17    $        (36)  $          48    $        (39)  $      (172)
                                                                                                                                                        
                                                                                                                                                        
Net  income  (loss)  per                                                                                                              
  share                                                                                                                                            
                                                                                                                                                        
    Basic                                        $      0.02    $    (0.05)  $      0.06    $    (0.05)  $    (0.23)
                                                                                                                                                        
    Diluted                                    $      0.02    $    (0.05)  $      0.06    $    (0.05)  $    (0.23)
                                                                                                                                                        
                                                      --------    --------    --------    --------    --------  
                                                                                                                                                        
Shares  used  in  per  share                                                                                                        
  calculation                                                                                                                                
                                                                                                                                                        
    Basic                                                  770              764              757              765              753  
                                                                                                                                                        
    Diluted                                              785              764              764              765              753  
                                                                                                                                                        
                                                      --------    --------    --------    --------    --------  
                                                                                                                                                        
                                                                                                                                                        
ADVANCED  MICRO  DEVICES,  INC.                                                                                                
CONDENSED  CONSOLIDATED  STATEMENTS  OF  COMPREHENSIVE  INCOME  (LOSS)                        
(Millions)                                                                                                                                    
                                                                                                                                                        
                                                                Three  Months  Ended                Nine  Months  Ended  
                                                      ----------------------------    ------------------  
                                                      Sep.  27,    Jun.  28,    Sep.  28,    Sep.  27,    Sep.  28,  
                                                          2014            2014            2013            2014            2013      
                                                                                                                                                        
                                                      --------    --------    --------    --------    --------  
                                                                                                                                                        
Total  comprehensive  income                                                                                                    
  (loss)                                        $          15    $        (32)  $          52    $        (38)  $      (171)
                                                                                                                                                        
                                                      --------    --------    --------    --------    --------  
                                                                                                                                                        
                                                                                                                                                        
                                                                                                                                                        
ADVANCED  MICRO  DEVICES,  INC.                                                                                                
CONDENSED  CONSOLIDATED  BALANCE  SHEETS                                                                              
(Millions)                                                                                                                                    
                                                                                                                                                        
                                                                                        ---------    ---------    ---------  
                                                                                          Sep.  27,      Jun.  28,      Dec.  28,  
                                                                                              2014              2014              2013      
                                                                                                                                                        
                                                                                        ---------    ---------    ---------  
                                                                                                                                                        
Assets                                                                                                                                            
                                                                                                                                                        
Current  assets:                                                                                                                          
    Cash  and  cash  equivalents                                  $          640    $          503    $          869  
    Marketable  securities                                                      298                445                228  
    Accounts  receivable,  net                                                973                872                832  
    Inventories,  net                                                                897                960                884  
    Prepaid  expenses  and  other  current  assets              212                152                  71  
                                                                                                                                                        
                                                                                        ---------    ---------    ---------  
                                                                                                                                                        
            Total  current  assets                                            3,020            2,932            2,884  
                                                                                                                                                        
Long-term  marketable  securities                                          -                    -                  90  
Property,  plant  and  equipment,  net                                328                329                346  
Acquisition  related  intangible  assets,  net                  69                  72                  78  
Goodwill                                                                                    553                553                553  
Other  assets                                                                            355                360                386  
                                                                                        ---------    ---------    ---------  
                                                                                                                                                        
Total  Assets                                                                $      4,325    $      4,246    $      4,337  
                                                                                        =========    =========    =========  
                                                                                                                                                        
Liabilities  and  Stockholders'  Equity                                                                                
                                                                                                                                                        
Current  liabilities:                                                                                                                
    Short-term  debt                                                      $          102    $          101    $            60  
    Accounts  payable                                                                498                511                519  
    Payable  to  GLOBALFOUNDRIES                                            317                295                364  
    Accrued  and  other  current  liabilities                      555                480                530  
    Deferred  income  on  shipments  to                                                                                      
      distributors                                                                        94                118                145  
                                                                                                                                                        
                                                                                        ---------    ---------    ---------  
                                                                                                                                                        
            Total  current  liabilities                                  1,566            1,505            1,618  
                                                                                                                                                        
Long-term  debt                                                                    2,106            2,109            1,998  
Other  long-term  liabilities                                              118                131                177  
                                                                                                                                                        
Stockholders'  equity:                                                                                                              
    Capital  stock:                                                                                                                        
        Common  stock,  par  value                                                  8                    8                    7  
        Additional  paid-in  capital                                    6,928            6,905            6,894  
        Treasury  stock,  at  cost                                            (118)            (114)            (112)
    Accumulated  deficit                                                    (6,282)        (6,299)        (6,243)
    Accumulated  other  comprehensive  income                                                                        
      (loss)                                                                                    (1)                  1                  (2)
                                                                                                                                                        
                                                                                        ---------    ---------    ---------  
                                                                                                                                                        
            Total  stockholders'  equity                                    535                501                544  
                                                                                                                                                        
                                                                                        ---------    ---------    ---------  
                                                                                                                                                        
Total  Liabilities  and  Stockholders'  Equity    $      4,325    $      4,246    $      4,337  
                                                                                        =========    =========    =========  
                                                                                                                                                        
                                                                                                                                                        
                                                                                                                                                        
ADVANCED  MICRO  DEVICES,  INC.                                                                                                
CONDENSED  CONSOLIDATED  STATEMENT  OF  CASH  FLOWS                                                            
(Millions)                                                                                                                                    
                                                                          Three  Months  Ended      Nine  Months  Ended  
                                                                          ------------------    ------------------  
                                                                                    Sep.  27,                        Sep.  27,            
                                                                                        2014                                2014                
                                                                                                                                                        
                                                                          ------------------    ------------------  
                                                                                                                                                        
Cash  flows  from  operating                                                                                                      
  activities:                                                                                                                                
    Net  Income  (loss)                                    $                              17    $                            (39)
    Adjustments  to  reconcile  net                                                                                            
      income  (loss)  to  net  cash                                                                                                
      provided  by  (used  in)  operating                                                                                    
      activities:                                                                                                                            
        Depreciation  and  amortization                                        49                                  155  
        Employee  stock-based                                                                                                        
          compensation  expense                                                        21                                    65  
        Non-cash  interest  expense                                                  2                                    11  
        Loss  on  debt  redemptions                                                    -                                    64  
        Other                                                                                        (6)                                  (9)
    Changes  in  operating  assets  and                                                                                      
      liabilities:                                                                                                                          
        Accounts  receivable                                                        (104)                              (144)
        Inventories                                                                            62                                  (14)
        Prepaid  expenses  and  other                                                                                            
          assets                                                                                  (71)                              (156)
        Payable  to  GLOBALFOUNDRIES                                              22                                  (47)
        Accounts  payable,  accrued                                                                                              
          liabilities  and  other                                                      26                                (100)
                                                                          ------------------    ------------------  
Net  cash  provided  by  (used  in)                                                                                            
  operating  activities                                $                              18    $                          (214)
                                                                          ------------------    ------------------  
                                                                                                                                                        
Cash  flows  from  investing                                                                                                      
  activities:                                                                                                                                
    Purchases  of  property,  plant  and                                                                                    
      equipment                                                                                (29)                                (73)
    Purchases  of  available-for-sale                                                                                      
      securities                                                                              (28)                              (646)
    Proceeds  from  sale  and  maturity  of                                                                                
      available-for-sale  securities                                        176                                  664  
                                                                          ------------------    ------------------  
Net  cash  provided  by  (used  in)                                                                                            
  investing  activities                                $                            119    $                            (55)
                                                                          ------------------    ------------------  
                                                                                                                                                        
Cash  flows  from  financing                                                                                                      
  activities:                                                                                                                                
    Net  proceeds  from  foreign  grants                                                                                    
      and  allowances                                        $                                3    $                                5  
    Proceeds  from  issuance  of  common                                                                                    
      stock                                                                                            2                                      4  
    Proceeds  from  borrowings,  net                                              -                              1,080  
    Repayments  of  long-term  debt  and                                                                                    
      capital  lease  obligations                                                  (1)                          (1,043)
    Other                                                                                            (4)                                  (6)
                                                                          ------------------    ------------------  
Net  cash  provided  by  financing                                                                                            
  activities                                                    $                                -    $                              40  
                                                                          ------------------    ------------------  
Net  increase  (decrease)  in  cash  and                                                                                  
  cash  equivalents                                                                      137                                (229)
                                                                          ------------------    ------------------  
Cash  and  cash  equivalents  at                                                                                                
  beginning  of  period                                  $                            503    $                            869  
                                                                          ------------------    ------------------  
Cash  and  cash  equivalents  at  end  of                                                                                  
  period                                                            $                            640    $                            640  
                                                                          ------------------    ------------------  
                                                                                                                                                        
                                                                                                                                                        
ADVANCED  MICRO  DEVICES,  INC.                                                                                                
SELECTED  CORPORATE  DATA                                                                                                          
(Millions  except  headcount)                                                                                                  
                                                                                                                                                        
                                                                                                                                                        
                                                        Three  Months  Ended                        Nine  Months  Ended  
----------------------------------------------------          -------------------
                                              Sep.  27,    Jun.  28,    Sep.  28,            Sep.  27,    Sep.  28,  
Segment  and  Category                                                                                                                
  Information                          2014            2014            2013                    2014            2013      
                                                                                                                                                        
----------------------------------------------------          -------------------
                                                                                                                                                        
    Computing  and                                                                                                                          
      Graphics  (1)                                                                                                                          
        Net  revenue                $        781    $        828    $        925            $    2,470    $    2,832  
        Operating  income                                                                                                                
          (loss)                        $        (17)  $          (6)  $            9            $        (20)  $        (86)
                                                                                                                                                        
    Enterprise,  Embedded                                                                                                            
      and  Semi-Custom  (2)                                                                                                            
        Net  revenue                          648              613              536                  1,797              878  
        Operating  income                108                97                92                      290              166  
                                                                                                                                                        
    All  Other  (3)                                                                                                                          
        Operating  loss                    (28)            (28)              (6)                    (95)          (112)
                                                                                                                                                        
    Total                                                                                                                                          
        Net  revenue                $    1,429    $    1,441    $    1,461            $    4,267    $    3,710  
        Operating  income                                                                                                                
          (loss)                        $          63    $          63    $          95            $        175    $        (32)
                                                                                                                                                        
----------------------------------------------------          -------------------
                                                                                                                                                        
Other  Data                                                                                                                                    
                                                                                                                                                        
    Depreciation  and                                                                                                                    
      amortization,                                                                                                                        
      excluding                                                                                                                                
      amortization  of                                                                                                                    
      acquired  intangible                                                                                                            
      assets                            $          46    $          49    $          52            $        145    $        168  
    Capital  additions        $          29    $          23    $          15            $          73    $          63  
    Adjusted  EBITDA  (4)    $        133    $        137    $        153            $        409    $        247  
    Cash,  cash                                                                                                                                
      equivalents  and                                                                                                                    
      marketable                                                                                                                              
      securities,                                                                                                                            
      including  long-term                                                                                                            
      marketable                                                                                                                              
      securities                    $        938    $        948    $    1,181            $        938    $    1,181  
    Non-GAAP  free  cash                                                                                                                
      flow  (5)                        $        (11)  $        (51)  $            6            $      (287)  $      (232)
    Total  assets                  $    4,325    $    4,246    $    4,317            $    4,325    $    4,317  
    Total  debt                      $    2,208    $    2,210    $    2,049            $    2,208    $    2,049  
    Headcount                            10,149        10,300        10,330                10,149        10,330  
                                                                                                                                                        
----------------------------------------------------          -------------------
                                                                                                                                                        
                                                                                                                                                        
(1)    Computing  and  Graphics  segment  primarily  includes  desktop  and  notebook  
            processors  and  chipsets,  discrete  graphics  processing  units  (GPUs)  and
            professional  graphics.                                                                                                
                                                                                                                                                        
(2)    Enterprise,  Embedded  and  Semi-Custom  segment  primarily  includes  server  
            and  embedded  processors,  dense  servers,  semi-custom  System-on-Chip        
            (SoC)  products,  engineering  services  and  royalties.                                      
                                                                                                                                                        
(3)    All  Other  category  primarily  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  and            
            employee  stock-based  compensation  expense.  In  addition,  the  Company      
            also  included  the  following  adjustments  for  the  indicated  periods:  for
            the  nine  months  ended  September  27,  2014,  the  Company  included  an          
            adjustment  for  workforce  rebalancing  severance  charges;  and  for  the      
            third  quarter  of  2013  and  nine  months  ended  September  28,  2013,  the      
            Company  included  an  adjustment  for  net  restructuring  and  other  special
            charges  (gains.)                                                                                                            
                                                                                                                                                        
(4)    Reconciliation  of  GAAP  operating  income  (loss)  to  Adjusted  EBITDA*          
                                                                        Three  Months  Ended          Nine  Months  Ended
                                                              ---------------------------  -----------------
                                                              Sep.  27,    Jun.  28,  Sep.  28,  Sep.  27,  Sep.  28,
                                                                  2014            2014          2013          2014          2013    
                                                              --------    --------  --------  --------  --------
          GAAP  operating  income                                                                                                    
            (loss)                                      $          63    $          63  $          95  $        175  $      (32)
              Workforce  rebalancing                                                                                                
                severance  charges                          -                  -                -              14                -
              Depreciation  and                                                                                                          
                amortization                                  46                49              52            145            168
              Employee  stock-based                                                                                                  
                compensation  expense                  21                21              23              65              67
              Amortization  of  acquired                                                                                          
                intangible  assets                          3                  4                5              10              14
              Restructuring  and  other                                                                                            
                special  charges                                                                                                          
                (gains),  net                                    -                  -            (22)              -              30
                                                              --------    --------  --------  --------  --------
          Adjusted  EBITDA                      $        133    $        137  $        153  $        409  $        247
                                                              ========    ========  ========  ========  ========
                                                                                                                                                        
                                                                                                                                                        
(5)    Non-GAAP  free  cash  flow  reconciliation**                                                              
                                                                        Three  Months  Ended          Nine  Months  Ended
                                                              ---------------------------  -----------------
                                                              Sep.  27,    Jun.  28,  Sep.  28,  Sep.  27,  Sep.  28,
                                                                  2014            2014          2013          2014          2013    
                                                              --------    --------  --------  --------  --------
          GAAP  net  cash  provided  by                                                                                            
            (used  in)  operating                                                                                                      
            activities                              $          18    $      (28)  $          21  $    (214)  $    (169)
              Purchases  of  property,                                                                                              
                plant  and  equipment                  (29)          (23)          (15)          (73)          (63)
                                                              --------    --------  --------  --------  --------
          Non-GAAP  free  cash  flow      $        (11)  $      (51)  $            6  $    (287)  $    (232)
                                                              ========    ========  ========  ========  ========
                                                                                                                                                        
                                                                                                                                                        
          *  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  indicated  periods:  for  the  nine  months  ended              
          September  27,  2014,  the  Company  included  an  adjustment  for  workforce      
          rebalancing  severance  charges;  and  for  the  third  quarter  of  2013  and      
          nine  months  ended  September  28,  2013,  the  Company  included  an                    
          adjustment  for  net  restructuring  and  other  special  charges  (gains).  The
          Company  calculates  and  communicates  Adjusted  EBITDA  in  the  earnings        
          press  release  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      
          press  release  as  a  supplemental  measure  of  its  performance.  Non-GAAP      
          free  cash  flow  is  determined  by  adjusting  GAAP  net  cash  used  in                
          operating  activities  for  capital  expenditures.  The  Company  calculates    
          and  communicates  non-GAAP  free  cash  flow  in  the  financial  earnings          
          press  release  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                
          earnings  press  release  of  these  non-GAAP  financial  measures  to  the  most
          directly  comparable  GAAP  financial  measures.                                                      
                                                                                                                                                        
                                                                                                                                                        
 

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