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AMD Reports Third Quarter Results

SUNNYVALE, CA, Oct 14, 2010 (MARKETWIRE via COMTEX) --

AMD (NYSE: AMD)

--  AMD revenue $1.62 billion, 2 percent sequential decrease and 16
    percent increase year-over-year
--  Net loss $118 million, net loss per share $0.17, operating income $128
    million
--  Non-GAAP(1,2) net income $108 million, EPS $0.15, operating income
    $144 million
--  Gross margin 46 percent

AMD (NYSE: AMD) today announced revenue for the third quarter of 2010 of $1.62 billion, a net loss of $118 million, or $0.17 per share, and operating income of $128 million. The company reported non-GAAP net income of $108 million, or $0.15 per share, and non-GAAP operating income of $144 million.

"AMD's third quarter performance was highlighted by solid gross margin and a continued focus on profitability, despite weaker than expected consumer demand," said Dirk Meyer, AMD president and CEO. "Our strategy to deliver platforms with superior visual experiences continues to resonate. We look forward to building on this momentum when we begin shipping our first AMD Fusion Accelerated Processor Units later this quarter."

                         GAAP Financial Results
                               Q3-10            Q2-10            Q3-09
                          --------------   --------------   --------------
Revenue                       $1.62B           $1.65B           $1.40B
                          --------------   --------------   --------------
Operating income (loss)        $128M            $125M           $(77)M
                          --------------   --------------   --------------
Net loss attributable to
 AMD common stockholders/
 loss per share           $(118)M/$(0.17)  $ (43)M/$(0.06)  $(128)M/$(0.18)
                          --------------   --------------   --------------
                      Non-GAAP Financial Results(1)
                               Q3-10            Q2-10            Q3-09
                          --------------   --------------   --------------
Revenue                       $1.62B           $1.65B           $1.40B
                          --------------   --------------   --------------
Operating income               $144M            $138M            $47M
                          --------------   --------------   --------------
Net income / Earnings
 per share                  $108M/$0.15      $83M/$0.11        $2M/$0.00
                          --------------   --------------   --------------

Quarterly Summary

--  Gross margin was 46 percent.
--  Cash, cash equivalents and marketable securities balance at the end of
    the quarter was $1.73 billion. The decrease from the second quarter
    was primarily due to the repurchase of $800 million aggregate
    principal amount of 6.00% Convertible Senior Notes due 2015 offset by
    proceeds from our issuance of $500 million of 7.75% Senior Notes due
    2020.
--
    --  Approximately $780 million of the 6.00% Convertible Senior Notes
        remained outstanding as of September 25, 2010.
--  Computing Solutions segment revenue was flat sequentially and up 13
    percent year-over-year.  The year-over-year increase was primarily
    driven by record notebook microprocessor unit shipments.
--
    --  Operating income was $164 million, compared with $128 million in
        Q2-10 and $82 million in Q3-09.
    --  Microprocessor average selling price (ASP) decreased slightly
        sequentially and increased year-over-year.
    --  AMD updated its desktop processor family with six new offerings,
        including the six-core AMD Phenom(TM) II X6 1075 processor with
        high-end features like Turbo CORE acceleration technology, and the
        unlocked, quad-core AMD Phenom(TM) II X2 560 Black Edition
        processor which enables performance-tuning capabilities.
    --  IBM joined the ranks of global customers offering AMD
        Opteron(TM) 6000 series platform-based systems. In total, more
        than 40 unique AMD Opteron(TM) 6000 series-based platforms are
        now available from leading server manufacturers, including the HP
        ProLiant DL385 G7, the Dell PowerEdge(TM) R815, and many others.
    --  AMD released significant technical details of two new x86 cores
        during the quarter.  "Bulldozer" targets high-performance PC and
        server markets, while "Bobcat" is intended for low-power notebook
        and desktop markets.  Both cores were designed from the ground up
        to address specific customer requirements and compute workloads.
    --  AMD demonstrated "Brazos", the upcoming platform combining
        low-power x86 processor cores and discrete-level graphics
        capabilities in a single AMD Fusion Accelerated Processing Unit
        (APU). "Brazos" platforms will feature the "Ontario" and "Zacate"
        APUs and are expected to bring many of the vivid digital computing
        experiences once reserved for high-end PCs to value and mainstream
        notebooks and desktops early next year.
--  Graphics segment revenue decreased 11 percent sequentially but
    increased 33 percent year-over-year.  The sequential decrease was
    driven by decreased mobile graphics processor unit (GPU) unit
    shipments and decreased ASP.  The year-over-year increase was driven
    by an increase in GPU unit shipments and ASP.
--
    --  Operating income was $1 million, compared with $33 million in
        Q2-10 and $2 million in Q3-09.
    --  AMD has shipped more than 25 million DirectX11-capable GPUs since
        introduction in September 2009.
    --  AMD launched the ATI FirePro(TM) V9800, the company's flagship
        professional graphics card and the industry's only single-card
        solution for driving up to six monitors at a time.
    --  Apple refreshed its iMac and Mac Pro desktop computers, making ATI
        Radeon(TM) cards the only graphics solution for all
        configurations of these products.

Current Outlook

AMD's outlook statements are based on current expectations. The following statements are forward looking, and actual results could differ materially depending on market conditions and the factors set forth under "Cautionary Statement" below.

AMD expects revenue to be approximately flat sequentially for the fourth quarter of 2010.

AMD Teleconference

AMD will hold a conference call for the financial community at 2:00 p.m. PT (5:00 p.m. ET) today to discuss its third quarter financial results. AMD will provide a real-time audio broadcast of the teleconference on the Investor Relations page of its Web site at AMD. The webcast will be available for 10 days after the conference call.

Reconciliation of GAAP Net Income (Loss) Attributable to AMD Common stockholders to Non-GAAP Net Income (Loss) 1,3

(Millions except
 per share amounts)              Q3-10           Q2-10           Q3-09
                            --------------  --------------  --------------
GAAP net income (loss)
 attributable to AMD common
 stockholders / Earnings
 (loss) per share           $ (118) $(0.17) $  (43) $(0.06) $ (128) $(0.18)
                            ------  ------  ------  ------  ------  ------
  Net impact of GF/Foundry
   segment related items*     (186)  (0.25)   (120)  (0.16)   (191)  (0.27)
                            ------  ------  ------  ------  ------  ------
  Net (income) loss
   attributable to
   noncontrolling interest       -       -       -       -      29    0.04
                            ------  ------  ------  ------  ------  ------
  Class B preferred accretion    -       -       -       -     (22)  (0.03)
                            ------  ------  ------  ------  ------  ------
Non-GAAP net income (loss)
 excluding GF/Foundry
 segment related items          68    0.09      77    0.11      56    0.08
                            ------  ------  ------  ------  ------  ------
  Gross margin benefit from
   sales of inventory
   written down in Q4-08         -       -       -       -       9    0.01
                            ------  ------  ------  ------  ------  ------
  Amortization of acquired
   intangible assets           (16)  (0.02)    (17)  (0.02)    (17)  (0.02)
                            ------  ------  ------  ------  ------  ------
  Restructuring (charges)
   reversals                     -       -       4    0.01      (4)  (0.01)
                            ------  ------  ------  ------  ------  ------
  Gain on investment sale        -       -       7    0.01       -       -
                            ------  ------  ------  ------  ------  ------
  Gain (loss) on debt
   redemption                  (24)  (0.03)      -       -      66    0.10
                            ------  ------  ------  ------  ------  ------
Non-GAAP net income
 (loss) / Earnings
 (loss) per share           $  108  $ 0.15  $   83  $ 0.11  $    2  $ 0.00
                            ------  ------  ------  ------  ------  ------

* Q3-10 and Q2-10 consist of equity losses related to GF. Q3-09 consists of the Foundry segment and Intersegment Eliminations loss.

Reconciliation of GAAP to Non-GAAP Operating Income (Loss) 1,3

(Millions)                                           Q3-10   Q2-10   Q3-09
                                                    ------  ------  ------
GAAP operating income (loss)                        $  128  $  125  $  (77)
                                                    ------  ------  ------
  Gross margin benefit from sales of inventory
   written down in Q4-08                                 -       -       9
                                                    ------  ------  ------
  Amortization of acquired intangible assets           (16)    (17)    (17)
                                                    ------  ------  ------
  Restructuring (charges) reversals                      -       4      (4)
                                                    ------  ------  ------
  Operating income (loss) from Foundry segment and
   Intersegment Eliminations                             -       -    (112)
                                                    ------  ------  ------
Non-GAAP operating income (loss)                    $  144  $  138  $   47
                                                    ------  ------  ------

Reconciliation of GAAP to Non-GAAP Gross Margin 1,3

(Millions, except percentages)                       Q3-10   Q2-10   Q3-09
                                                    ------  ------  ------
GAAP Gross Margin                                   $  739  $  738  $  585
                                                    ------  ------  ------
GAAP Gross Margin %                                     46%     45%     42%
                                                    ------  ------  ------
  Gross margin benefit from sales of inventory
   written down in Q4-08                                 -       -       9
                                                    ------  ------  ------
  Gross margin from Foundry segment and
   Intersegment Eliminations                             -       -      49
                                                    ------  ------  ------
Non-GAAP Gross Margin                               $  739  $  738  $  527
                                                    ------  ------  ------
Non-GAAP Gross Margin %                                 46%     45%     38%
                                                    ------  ------  ------

About AMD Advanced Micro Devices (NYSE: AMD) is an innovative technology company dedicated to collaborating with customers and technology partners to ignite the next generation of computing and graphics solutions at work, home and play. For more information, visit AMD.

Cautionary Statement This release contains forward-looking statements concerning AMD, its fourth quarter 2010 revenue, the timing of the launch and ramp of new products and technologies and the features of these products, and demand for the Company's products, 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 "would," "may," "expects," "believes," "plans," "intends," "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 Corporation's pricing, marketing and rebating programs, product bundling, standard setting, new product introductions or other activities targeting the company's business will prevent attainment of the company's current plans; the company will be unable to develop, launch and ramp new products and technologies in the volumes and mix required by the market and at mature yields on a timely basis; the company will be unable to transition its products to advanced manufacturing process technologies in a timely and effective way; global business and economic conditions will not continue to improve or will worsen resulting in lower than currently expected revenue in the fourth quarter of 2010 and beyond; demand for computers and consumer electronics products and, in turn, demand for the company's products will be lower than currently expected; customers stop buying the company's products or materially reduce their demand for its products; the company will require additional funding and may not be able to raise funds on favorable terms or at all; there will be unexpected variations in market growth and demand for the company's products and technologies in light of the product mix that it may have available at any particular time or a decline in demand; the company will be unable to maintain the level of investment in research and development that is required to remain competitive; and the company will be unable to obtain sufficient manufacturing capacity or components to meet demand for its products or will under-utilize its commitment with respect to GLOBALFOUNDRIES' microprocessor manufacturing facilities. 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 June 26, 2010.

AMD, the AMD Arrow logo, AMD Opteron and combinations thereof, and ATI, the ATI logo, and Radeon 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 for non-GAAP net income (loss) excluding GF/Foundry segment related items, non-GAAP net income (loss), non-GAAP operating income (loss), non-GAAP earnings per share and non-GAAP gross margin. 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 Adjusted 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.

(2) Starting in the first quarter of 2010 the Company accounted for its investment in GLOBALFOUNDRIES (GF) under the equity method of accounting.

(3) Refer to corresponding tables at the end of this press release for additional AMD data.

ADVANCED MICRO DEVICES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Millions except per share amounts and percentages)
                               Quarter Ended            Nine Months Ended
                       ------------------------------  -------------------
                       Sept. 25,  June 26,  Sept. 26,  Sept. 25,  Sept. 26,
                         2010       2010      2009       2010       2009
                       ---------  --------  ---------  ---------  --------
Net revenue            $   1,618  $  1,653  $   1,396  $   4,845  $  3,757
Cost of sales                879       915        811      2,627     2,220
                       ---------  --------  ---------  ---------  --------
Gross margin                 739       738        585      2,218     1,537
Gross margin %                46%       45%        42%        46%       41%
Research and
 development                 359       371        420      1,053     1,289
Marketing, general and
 administrative              236       229        221        684       755
Amortization of
 acquired intangible
 assets                       16        17         17         50        52
Restructuring charges
 (reversal)                    -        (4)         4         (4)       65
                       ---------  --------  ---------  ---------  --------
Operating income
 (loss)                      128       125        (77)       435      (624)
Interest income                3         3          4          9        13
Interest expense             (56)      (55)      (114)      (160)     (319)
Other income
 (expense), net               (6)       (1)        47        297       147
                       ---------  --------  ---------  ---------  --------
Income (loss) before
 equity in net income
 (loss) of investee
 and income taxes             69        72       (140)       581      (783)
Provision (benefit)
 for income taxes              1        (5)        (5)        (4)      101
Equity in net income
 (loss) of investee         (186)     (120)         -       (489)        -
                       ---------  --------  ---------  ---------  --------
Net income (loss)      $    (118) $    (43) $    (135) $      96  $   (884)
Net (income) loss
 attributable to
 noncontrolling
 interest                      -         -         29          -        60
Class B preferred
 accretion                     -         -        (22)         -       (50)
                       ---------  --------  ---------  ---------  --------
Net income (loss)
 attributable to AMD
 common stockholders   $    (118) $    (43) $    (128) $      96  $   (874)
                       ---------  --------  ---------  ---------  --------
Net income (loss)
 attributable to AMD
 common stockholders
 per common share
   Basic               $   (0.17) $  (0.06) $   (0.18) $    0.13  $  (1.32)
   Diluted             $   (0.17) $  (0.06) $   (0.18) $    0.13  $  (1.32)
                       ---------  --------  ---------  ---------  --------
Shares used in per
 share calculation
   Basic                     713       709        694        710       662
   Diluted                   713       709        694        732       662
ADVANCED MICRO DEVICES, INC.
AMD NON-GAAP AND RECONCILIATIONS TO
CONSOLIDATED STATEMENTS OF OPERATIONS (1)
(Millions except per share amounts and percentages)
                                      Quarter Ended
                ----------------------------------------------------------
                       Sept. 25, 2010                 June 26, 2010
                ----------------------------  ----------------------------
                             GF                            GF
                          related                       related
                        adjustments    AMD            adjustments    AMD
                 AMD(2)     (3)     Non-GAAP   AMD(2)     (3)     Non-GAAP
                --------  --------  --------  --------  --------  --------
Net revenue     $  1,618  $      -  $  1,618  $  1,653  $      -  $  1,653
Cost of sales        879         -       879       915         -       915
                --------  --------  --------  --------  --------  --------
Gross margin         739         -       739       738         -       738
Gross margin %        46%                 46%       45%                 45%
Research and
 development         359         -       359       371         -       371
Marketing,
 general and
 administrative      236         -       236       229         -       229
Amortization of
 acquired
 intangible
 assets               16         -        16        17         -        17
Restructuring
 charges
 (reversal)            -         -         -        (4)        -        (4)
                --------  --------  --------  --------  --------  --------
Operating
 income (loss)       128         -       128       125         -       125
Interest income        3         -         3         3         -         3
Interest
 expense             (56)        -       (56)      (55)        -       (55)
Other income
 (expense), net       (6)        -        (6)       (1)        -        (1)
                --------  --------  --------  --------  --------  --------
Income (loss)
 before equity
 in net income
 (loss) of
 investee and
 income taxes         69         -        69        72         -        72
Provision
 (benefit) for
 income taxes          1         -         1        (5)        -        (5)
Equity in net
 income (loss)
 of investee        (186)     (186)        -      (120)     (120)        -
                --------  --------  --------  --------  --------  --------
Net income
 (loss)         $   (118) $   (186) $     68  $    (43) $   (120) $     77
Net Income
 (loss)
 attributable
 to non-
 controlling
 interest              -                             -
Class B
 preferred
 accretion             -                             -
                --------  --------  --------  --------  --------  --------
Net income
 (loss)
 attributable
 to AMD common
 stockholders   $   (118)           $     68  $    (43)           $     77
Non-GAAP
 diluted
 earnings per
 share(4)                           $   0.09                      $   0.11
                --------  --------  --------  --------  --------  --------
                       Quarter Ended
                ----------------------------
                       Sept. 26, 2009
                ----------------------------
                          Foundry
                          segment
                            and
                         Intersegment
                         Eliminations  AMD
                 AMD(2)      (3)    Non-GAAP
                --------  --------  --------
Net revenue     $  1,396  $      -  $  1,396
Cost of sales        811       (49)      860
                --------  --------  --------
Gross margin         585        49       536
Gross margin %        42%                 38%
Research and
 development         420       135       285
Marketing,
 general and
 administrative      221        26       195
Amortization of
 acquired
 intangible
 assets               17         -        17
Restructuring
 charges
 (reversal)            4         -         4
                --------  --------  --------
Operating
 income (loss)       (77)     (112)       35
Interest income        4         1         3
Interest
 expense            (114)      (44)      (70)
Other income
 (expense), net       47       (17)       64
                --------  --------  --------
Income (loss)
 before equity
 in net income
 (loss) of
 investee and
 income taxes       (140)     (172)       32
Provision
 (benefit) for
 income taxes         (5)       19       (24)
Equity in net
 income (loss)
 of investee           -         -         -
                --------  --------  --------
Net income
 (loss)         $   (135) $   (191) $     56
Net Income
 (loss)
 attributable
 to non-
 controlling
 interest             29
Class B
 preferred
 accretion           (22)
                --------  --------  --------
Net income
 (loss)
 attributable
 to AMD common
 stockholders   $   (128)           $     56
Non-GAAP
 diluted
 earnings per
 share(4)                           $   0.08
                --------  --------  --------
                                      Nine Months Ended
                  --------------------------------------------------------
                        Sept. 25, 2010               Sept. 26, 2009
                  ---------------------------  ---------------------------
                                                         Foundry
                               GF                      segment and
                             related                   Intersegment
                    AMD    adjustments  AMD      AMD   Eliminations  AMD
                    (2)       (3)     Non-GAAP   (2)       (3)     Non-GAAP
                  -------  ---------  -------  -------  ---------  -------
Net revenue       $ 4,845          -  $ 4,845  $ 3,757  $       -  $ 3,757
Cost of sales       2,627        (69)   2,696    2,220       (103)   2,323
                  -------  ---------  -------  -------  ---------  -------
Gross margin        2,218         69    2,149    1,537        103    1,434
Gross margin %         46%                 44%      41%                 38%
Research and
 development        1,053          -    1,053    1,289        393      896
Marketing,
 general and
 administrative       684          -      684      755         86      669
Amortization of
 acquired
 intangible
 assets                50          -       50       52          -       52
Restructuring
 charges
 (reversal)            (4)         -       (4)      65          -       65
                  -------  ---------  -------  -------  ---------  -------
Operating income
 (loss)               435         69      366     (624)      (376)    (248)
Interest income         9          -        9       13          1       12
Interest expense     (160)         -     (160)    (319)      (104)    (215)
Other income
 (expense), net       297        325      (28)     147        (61)     208
                  -------  ---------  -------  -------  ---------  -------
Income (loss)
 before equity in
 net income
 (loss) of
 investee and
 income taxes         581        394      187     (783)      (540)    (243)
Provision
 (benefit) for
 income taxes          (4)         -       (4)     101        145      (44)
Equity in net
 income (loss) of
 investee            (489)      (489)       -        -          -        -
                  -------  ---------  -------  -------  ---------  -------
Net income (loss) $    96  $     (95) $   191  $  (884) $    (685) $  (199)
Net Income (loss)
 attributable to
 non-controlling
 interest               -                           60
Class B preferred
 accretion              -                          (50)
                  -------  ---------  -------  -------  ---------  -------
Net income (loss)
 attributable to
 AMD common
 stockholders     $    96             $   191  $  (874)            $  (199)
Non-GAAP diluted
 earnings per
 share(4)                             $  0.26                      $ (0.30)
                  -------  ---------  -------  -------  ---------  -------
(1) From March 2, 2009 through December 26, 2009, the Company consolidated
    the operating results of GLOBALFOUNDRIES Inc. (GF).  Starting in the
    first fiscal quarter of 2010 the Company began to account for its
    investment in GF under the equity method of accounting.  The Company
    believes this non-GAAP presentation makes it easier for investors to
    compare current and historical period operating results, by excluding
    the results of operations of GF in the third and second fiscal quarters
    of 2010 and the nine months ended September 25, 2010, and Foundry
    segment and Intersegment Eliminations in the third fiscal quarter of
    2009 and nine months ended September 26, 2009.
(2) Starting in the first fiscal quarter of 2010, the Company began to
    account for its investment in GF under the equity method of accounting.
    From March 2, 2009 through December 26, 2009 the operating results
    of GF were included in the Foundry segment.
(3) For the third and second fiscal quarters of 2010, the Company excluded
    Equity in net income (loss) of investee. For the nine months ended
    September 25, 2010, the Company also excluded the gain recognized on
    the fair value assessment of its investment in GF upon deconsolidation,
    and the gross margin benefit due to the deconsolidation of GF. For the
    third fiscal quarter of 2009 and the nine months ended September 26,
    2009, the Company excluded the Foundry segment and Intersegment
    Eliminations consisting of revenues, cost of sales, and profit on
    inventory between the Computing Solutions and the Foundry segments.
(4) The outstanding diluted share amount for the non-GAAP diluted earnings
    per share calculation for the third fiscal quarter of 2010, the second
    fiscal quarter of 2010, and the nine month period ended September 25,
    2010 are 731 million shares, 733 million shares, and 732 million
    shares, respectively. These share amounts exclude the 24 million
    shares issuable upon conversion of the Company's 5.75% convertible
    notes because the inclusion of these shares would be anti-dilutive.
ADVANCED MICRO DEVICES, INC.
CONSOLIDATED BALANCE SHEETS
(Millions)
                                           Sept. 25,  June 26,   Dec. 26,
                                             2010       2010       2009*
                                           ---------  ---------  ---------
Assets
Current assets:
   Cash, cash equivalents and marketable
    securities                             $   1,726  $   1,896  $   2,676
   Accounts receivable, net                      765        725        745
   Inventories, net                              622        581        567
   Deferred income taxes                           -          -          9
   Prepaid expenses and other current
    assets                                        99        111        278
                                           ---------  ---------  ---------
       Total current assets                    3,212      3,313      4,275
Property, plant and equipment, net               723        755      3,809
Investment in GLOBALFOUNDRIES                      -        148          -
Acquisition related intangible assets, net        48         64         98
Goodwill                                         323        323        323
Other assets                                     289        352        573
                                           ---------  ---------  ---------
Total Assets                               $   4,595  $   4,955  $   9,078
                                           =========  =========  =========
Liabilities and Stockholders' Equity
Current liabilities:
   Accounts payable                        $     464  $     409  $     647
   Accounts payable to GLOBALFOUNDRIES           216        213          -
   Accrued liabilities                           601        663        795
   Deferred income on shipments to
    distributors                                 151        148        138
   Other short-term obligations                  209        159        171
   Current portion of long-term debt and
    capital lease obligations                      3          3        308
   Other current liabilities                      21         35        151
                                           ---------  ---------  ---------
       Total current liabilities               1,665      1,630      2,210
Deferred income taxes                              -          1        197
Long-term debt and capital lease
 obligations, less current portion             2,185      2,418      4,252
Other long-term liabilities                      102        154        695
Noncontrolling interest                            -          -      1,076
Accumulated loss in excess of investment
 in GLOBALFOUNDRIES                               29          -          -
Stockholders' equity:
   Capital stock:
     Common stock, par value                       7          7          7
     Capital in excess of par value            6,540      6,562      6,524
     Treasury stock, at cost                    (102)       (99)       (98)
   Retained earnings (deficit)                (5,843)    (5,725)    (5,939)
   Accumulated other comprehensive income         12          7        154
                                           ---------  ---------  ---------
       Total stockholders' equity                614        752        648
                                           ---------  ---------  ---------
Total Liabilities and Stockholders' Equity $   4,595  $   4,955  $   9,078
                                           =========  =========  =========
* Includes the account balances of GF which were deconsolidated as of the
  beginning of the first quarter of 2010.
ADVANCED MICRO DEVICES, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Millions)
                                                                   Nine
                                                       Quarter     Months
                                                        Ended      Ended
                                                      ---------  ---------
                                                      Sept. 25,  Sept. 25,
                                                        2010       2010
                                                      ---------  ---------
Cash flows from operating activities:
 Net income (loss)                                    $    (118) $      96
 Adjustments to reconcile net income (loss) to net
  cash provided by (used in) operating activities:
  Equity in net income (loss) of investee                   186        489
  Gain on deconsolidation of GLOBALFOUNDRIES                  -       (325)
  Depreciation and amortization                              95        294
  Compensation recognized under employee stock plans         22         65
  Non-cash interest expense                                   8         25
  Loss on debt redemption                                    24         24
  Provision (benefit) for deferred income taxes               9         (2)
  Amortization of foreign grant                              (5)        (9)
  Net (gain) on sale of marketable securities                 -         (8)
  Other                                                       -         (2)
 Changes in operating assets and liabilities
  (excludes the effects of deconsolidation):
  Accounts receivable                                      (285)      (673)
  Inventories                                               (41)      (134)
  Prepaid expenses and other current assets                  (5)        14
  Other assets                                               (1)        13
  Accounts payable to GLOBALFOUNDRIES                         3         66
  Income taxes payable                                       (2)         3
  Accounts payable, accrued liabilities and other           (14)      (135)
                                                      ---------  ---------
Net cash provided by (used in) operating activities        (124)      (199)
                                                      ---------  ---------
Cash flows from investing activities:
 Purchases of property, plant and equipment                 (31)      (110)
 Purchases of available-for-sale securities                (647)    (1,315)
 Net cash impact of change in status of
  GLOBALFOUNDRIES from consolidated entity to
  unconsolidated investee                                     -       (904)
 Proceeds from sale of property, plant and equipment          -          1
 Proceeds from sale and maturity of
  available-for-sale securities                             315      1,224
 Proceeds from sale of trading securities                    36         61
 Other                                                        6         23
                                                      ---------  ---------
Net cash provided by (used in) investing activities        (321)    (1,020)
                                                      ---------  ---------
Cash flows from financing activities:
 Proceeds from borrowings, net of issuance cost             800      1,223
 Net proceeds from foreign grants                             -         11
 Proceeds from issuance of AMD common stock                   2          9
 Repayments of debt and capital lease obligations          (818)    (1,058)
 Other                                                       (3)        (3)
                                                      ---------  ---------
Net cash provided by (used in) financing activities         (19)       182
                                                      ---------  ---------
Net increase (decrease) in cash and cash equivalents       (464)    (1,037)
                                                      ---------  ---------
Cash and cash equivalents at beginning of period          1,084      1,657
                                                      ---------  ---------
Cash and cash equivalents at end of period            $     620  $     620
                                                      ---------  ---------
ADVANCED MICRO DEVICES, INC.
SELECTED CORPORATE DATA
(Millions except headcount)
                                     Quarter Ended       Nine Months Ended
                               -------------------------  ----------------
                                Sept.    June     Sept.    Sept.    Sept.
Segment and Category             25,      26,      26,      25,      26,
 Information                    2010     2010     2009     2010     2009
                               -------  -------  -------  -------  -------
Computing Solutions (1)
     Net revenue               $ 1,226  $ 1,212  $ 1,082  $ 3,598  $ 2,950
     Operating income (loss)       164      128       82      438      (19)
Graphics (2)
     Net revenue                   390      440      293    1,239      746
     Operating income (loss)         1       33        2       81      (15)
All Other (3)
     Net revenue                     2        1       21        8       61
     Operating income (loss)       (37)     (36)     (49)     (84)    (214)
Subtotal (excludes Foundry
 segment and Intersegment
 Eliminations)
     Net revenue                 1,618    1,653    1,396    4,845    3,757
     Operating income (loss)       128      125       35      435     (248)
Foundry (4)
     Net revenue                     -        -      256        -      792
     Operating income (loss)         -        -     (101)       -     (334)
Intersegment Eliminations (5)
     Net revenue                     -        -     (256)       -     (792)
     Operating income (loss)         -        -      (11)       -      (42)
Total AMD
     Net revenue               $ 1,618  $ 1,653  $ 1,396  $ 4,845  $ 3,757
     Operating income (loss)   $   128  $   125  $   (77) $   435  $  (624)
                               -------  -------  -------  -------  -------
Other Data
Depreciation and amortization
 (excluding amortization
  of acquired intangible
  assets)                      $    79  $    83  $   265  $   244  $   792
Capital additions              $    31  $    31  $    97  $   110  $   293
Headcount (excludes Foundry
 segment)                       11,021   10,649   10,412   11,021   10,412
AMD non-GAAP comparison*
     Depreciation and
      amortization
      (excluding
       amortization of
       acquired intangible
       assets)                 $    79  $    83  $    96  $   244  $   303
     Capital additions         $    31  $    31  $    19  $   110  $    51
     Adjusted EBITDA (6)       $   245  $   244  $   169  $   790  $   245
     Cash, cash equivalents
      and marketable
      securities (7)           $ 1,726  $ 1,896  $ 1,536  $ 1,726  $ 1,536
     Adjusted free cash flow
      (8)                      $    91  $    76      N/A  $   344      N/A
     Total assets (7)          $ 4,595  $ 4,955  $ 4,376  $ 4,595  $ 4,376
     Long-term debt and
      capital lease
      obligations(7)           $ 2,188  $ 2,421  $ 3,541  $ 2,188  $ 3,541
                               -------  -------  -------  -------  -------
* 2009 periods exclude Foundry segment and Intersegment Eliminations
  See footnotes below.
(1)  Computing Solutions segment includes microprocessors, chipsets and
     embedded processors.
(2)  Graphics segment includes graphics, video and multimedia products
     and related revenue as well as revenue received in connection with
     the development and sale of game console systems that incorporate the
     Company's graphics technology.
(3)  All Other category includes non-Foundry segment employee stock-based
     compensation expense and certain operating expenses and credits that
     are not allocated to the operating segments.  Also included in this
     category is a gross margin benefit from the deconsolidation of GF,
     amortization of acquired intangible assets, restructuring charges
     (reversals) and GF formation costs.  The All Other category also
     includes the results of our Handheld business unit.
(4)  In 2009, Foundry segment included the operating results attributable
     to the front end wafer manufacturing operations and related activities
     as of the beginning of the first quarter of 2009, which includes the
     operating results of GF from March 2, 2009 to December 26, 2009.
     Starting with the first quarter of 2010, the Company began to account
     for its investment in GF under the equity method of accounting.
(5)  In 2009, Intersegment Eliminations represented eliminations in
     revenue and in cost of sales and profits on inventory between the
     Computing Solutions segment and the Foundry segment.  For the fiscal
     quarter and nine months ended September 26, 2009, Intersegment
     Eliminations of revenue was $256 million and $792 million,
     respectively.   For the fiscal quarter and nine months ended September
     26, 2009, Intersegment Eliminations of cost of sales and profits on
     inventory was $245 million and $750 million, respectively.
(6) AMD reconciliation of GAAP operating income (loss) to Adjusted EBITDA*
                              Quarter Ended             Nine Months Ended
                       Q310       Q210       Q309       Q310       Q309
                     ---------  ---------  ---------  ---------  ---------
    GAAP operating
     income (loss)   $     128  $     125  $     (77) $     435  $    (624)
      Foundry
       segment and
       Intersegment
       Eliminations
       operating
       loss                  -          -        112          -        376
      Depreciation
       and
       amortization         79         83         96        244        303
      Employee
       stock-based
       compensation
       expense              22         23         17         65         52
      Amortization
       of acquired
       intangible
       assets               16         17         17         50         52
      Restructuring
       charges
       (reversals)           -         (4)         4         (4)        65
      GF formation
       costs                 -          -          -          -         21
                     ---------  ---------  ---------  ---------  ---------
    Adjusted EBITDA  $     245  $     244  $     169  $     790  $     245
                     =========  =========  =========  =========  =========
                             -          -          -          -          -
(7) Reconciliation of select balance sheet items
                             Quarter Ended
                                  Q309
                     -------------------------------
                     Cash, cash
                    equivalents            Long-term
                        and                 debt and
                     marketable   Total   capital lease
                     securities   Assets  obligations**
    AMD GAAP         $   2,511  $   8,747  $   5,570
    Foundry segment
     and Intersegment
     Eliminations        (975)    (4,371)    (2,029)
                     ---------  ---------  ---------
    AMD Non-GAAP     $   1,536  $   4,376  $   3,541
                     =========  =========  =========
(8) Non-GAAP adjusted free cash flow reconciliation***
                         Quarter Ended
                        Q310       Q210
                     ---------  ---------
     GAAP net cash
      provided by
      (used in)
      operating
      activities     $    (124) $     (98)
      Non-GAAP
       adjustment          246        205
                     ---------  ---------
     Non-GAAP net
      cash provided
      by (used in)
      operating
      activities           122        107
      Purchases of
       property,
       plant and
       equipment           (31)       (31)
                     ---------  ---------
     Non-GAAP
      adjusted free
      Cash Flow      $      91  $      76
                     =========  =========
*Starting with the quarter ended December 26, 2009, the Company presented
"Adjusted EBITDA" as a supplemental measure of its performance. Adjusted
EBITDA for the Company was determined by adjusting operating income (loss)
for depreciation and amortization, employee stock-based compensation
expense and amortization of acquired intangible assets.  In addition, for
the second quarter of 2010 and the nine months ended September 25, 2010,
the Company further included an adjustment for certain restructuring
reversals.  For the third quarter and nine months ended September 26, 2009,
the Company further included adjustments for the Foundry segment and
Intersegment Eliminations operating loss and restructuring charges, and for
the nine months ended September 26, 2009, the Company further included an
adjustment for GF formation costs.  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.
** Long-term debt and capital lease obligations also includes the current
portion.
"*** Starting in the first quarter of 2010, the Company presents non-GAAP
adjusted free cash flow as a supplemental measure of its performance.  In
2008 and 2009 the Company and certain of its subsidiaries (collectively,
the "AMD Parties") entered into supplier agreements with IBM Credit LLC and
certain of its subsidiaries, (collectively, the "IBM Parties").   Pursuant
to these supplier agreements, the AMD Parties sell to the IBM Parties
invoices of selected distributor customers.   Because the Company does not
recognize revenue until its distributors sell its products to their
customers, under U.S. GAAP, the Company classifies funds received from the
IBM Parties as debt on the balance sheet. Moreover, for cash flow purposes,
these funds are classified as cash flows from financing activities.  When a
distributor pays the applicable IBM Party, the Company reduces the
distributor's accounts receivable and the corresponding debt resulting in a
non-cash accounting entry.  Because the Company does not receive the cash
from the distributor to reduce the accounts receivable, the distributor's
payment is never reflected in the Company's cash flows from operating
activities.  Non-GAAP adjusted free cash flow for the Company was
determined by adjusting GAAP net cash provided by (used in) operating
activities by adding the distributors' payments to the IBM Parties to GAAP
net cash provided by (used in) operating activities. This amount is then
further adjusted by subtracting capital expenditures.  Generally, under
U.S. GAAP, the reduction in accounts receivable is assumed to be a source
of operating cash flows.  Therefore, the Company believes that treating the
payments from its distributor customers to the IBM Parties as if the
Company actually received the cash from the distributor and then used that
cash to pay down the debt is more reflective of the economic substance of
the transaction.  The Company calculates and communicates non-GAAP adjusted
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 Adjusted 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 Adjusted
Free Cash Flow as an alternative to GAAP liquidity measures of cash flows
from operating or financing activities.

Media Contact
Drew Prairie
512-602-4425
Email Contact

Investor Contact
Ruth Cotter
408-749-3887
Email Contact


SOURCE: Advanced Micro Devices

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