AMD Reports 2013 Fourth Quarter and Annual Results
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AMD Reports 2013 Fourth Quarter and Annual Results

SUNNYVALE, CA -- (Marketwired) -- Jan 21, 2014 -- AMD (NYSE: AMD)

Q4 2013 Results

2013 Annual Results

AMD (NYSE: AMD) today announced revenue for the fourth quarter of 2013 of $1.59 billion, operating income of $135 million and net income of $89 million, or $0.12 per share. The company reported non-GAAP operating income of $91 million and non-GAAP net income of $45 million, or $0.06 per share.

For the year ended December 28, 2013, AMD reported revenue of $5.3 billion, operating income of $103 million and a net loss of $83 million, or $0.11 per share.

"Strong execution of our strategic transformation plan drove significant revenue growth and improved profitability in the fourth quarter," said Rory Read, AMD president and CEO. "The continued ramp of our semi-custom SoCs and leadership graphics products resulted in a 38 percent revenue increase from the year ago quarter. Our focus in 2014 is to deliver revenue growth and profitability for the full year by leveraging our differentiated IP to drive success in our targeted new markets and core businesses."

                                                                            
                           GAAP Financial Results                           
                                                                            
----------------------------------------------------------------------------
                         Q4-13      Q3-13      Q4-12      2013       2012   
----------------------------------------------------------------------------
Revenue                 $1.59B     $1.46B     $1.16B     $5.30B     $5.42B  
----------------------------------------------------------------------------
Operating income         $135M      $95M      $(422)M     $103M    $(1.06)B 
 (loss)                                                                     
----------------------------------------------------------------------------
Net income (loss) /   $89M/$0.12 $48M/$0.06 $(473)M/   $(83)M/     $(1.18)B/
 Earnings (loss) per                         $(0.63)    $(0.11)     $(1.60)  
 share                                                                      
----------------------------------------------------------------------------
                                                                            
                                                                            
                                                                            
                        Non-GAAP(1) Financial Results                       
                                                                            
----------------------------------------------------------------------------
                         Q4-13      Q3-13      Q4-12      2013       2012   
----------------------------------------------------------------------------
Revenue                 $1.59B     $1.46B     $1.16B     $5.30B     $5.42B  
----------------------------------------------------------------------------
Operating income         $91M       $78M      $(55)M      $103M      $45M   
 (loss)                                                                     
----------------------------------------------------------------------------
Net income (loss) /   $45M/$0.06 $31M/$0.04 $(102)M/   $(83)M/     $(114)M/
 Earnings (loss) per                         $(0.14)    $(0.11)     $(0.16)  
 share                                                                      
----------------------------------------------------------------------------
                                                                            
                                                                            

Quarterly Financial Summary

Recent Highlights

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.

For the first quarter of 2014, AMD expects revenue to decrease 16 percent, plus or minus 3 percent, sequentially.

For additional details regarding AMD's results and outlook please see the CFO commentary posted at quarterlyearnings.amd.com.

AMD Teleconference

AMD will hold a conference call for the financial community at 2:30 p.m. PT (5:30 p.m. ET) today to discuss its fourth quarter and annual financial results. AMD will provide a real-time audio broadcast of the teleconference on the Investor Relations page of its website at www.amd.com. The webcast will be available for 12 months after the conference call.

                                                                            
Reconciliation of GAAP to Non-GAAP Gross Margin(1)                          
                                                                            
                               ---------------------------------------------
(Millions except percentages)    Q4-13    Q3-13    Q4-12     2013     2012  
----------------------------------------------------------------------------
GAAP Gross Margin               $   553  $   521  $   178  $ 1,978  $ 1,235 
----------------------------------------------------------------------------
GAAP Gross Margin %                  35%      36%      15%      37%      23%
----------------------------------------------------------------------------
  Lower of cost or market                                                   
   charge related to GF take-                                               
   or-pay obligation                  -        -      273        -      273 
----------------------------------------------------------------------------
  Limited waiver of exclusivity                                             
   from GF                            -        -        -        -      703 
----------------------------------------------------------------------------
  Legal settlements, net              -        -        -        -        5 
----------------------------------------------------------------------------
Non-GAAP Gross Margin           $   553  $   521  $   451  $ 1,978  $ 2,216 
----------------------------------------------------------------------------
Non-GAAP Gross Margin %              35%      36%      39%      37%      41%
----------------------------------------------------------------------------
                                                                            
                                                                            
                                                                            
Reconciliation of GAAP to Non-GAAP(1) Operating Income (Loss)               
                                                                            
                               ---------------------------------------------
(Millions)                       Q4-13    Q3-13    Q4-12     2013     2012  
----------------------------------------------------------------------------
GAAP operating income (loss)    $   135  $    95  $  (422) $   103  $(1,056)
----------------------------------------------------------------------------
  Amortization of acquired                                                  
   intangible assets                  4        5        4       18       14 
----------------------------------------------------------------------------
  Restructuring and other                                                   
   special charges (gains), net       -      (22)      90       30      100 
----------------------------------------------------------------------------
  Legal settlements, net            (48)       -        -      (48)       5 
----------------------------------------------------------------------------
  Limited waiver of exclusivity                                             
   from GF                            -        -        -        -      703 
----------------------------------------------------------------------------
  Lower of cost or market                                                   
   charge related to GF take-                                               
   or-pay obligation                  -        -      273        -      273 
----------------------------------------------------------------------------
  SeaMicro acquistion costs           -        -        -        -        6 
----------------------------------------------------------------------------
Non-GAAP operating income                                                   
 (loss)                         $    91  $    78  $   (55) $   103  $    45 
----------------------------------------------------------------------------
                                                                            
                                                                            
                                                                                                  
Reconciliation of GAAP to Non-GAAP Net Income (Loss)                                              
                                                                            
                                --------------------------------------------
(Millions except per share                                                  
 amounts)                            Q4-13         Q3-13         Q4-12      
----------------------------------------------------------------------------
GAAP net income (loss) /                                                    
 Earnings (loss) per share       $ 89  $ 0.12  $ 48  $ 0.06  $(473) $(0.63) 
----------------------------------------------------------------------------
  Amortization of acquired                                                  
   intangible assets                4       -     5    0.01      4    0.01  
----------------------------------------------------------------------------
  Restructuring and other                                                   
   special charges (gains), net     -       -   (22)  (0.03)    90    0.12  
----------------------------------------------------------------------------
  Legal settlements, net          (48)  (0.06)    -       -      -       -  
----------------------------------------------------------------------------
  Limited waiver of exclusivity                                             
   from GF                          -       -     -       -      -       -  
----------------------------------------------------------------------------
  Lower of cost or market charge                                            
   related to GF take-or-pay                                                
   obligation                       -       -                  273    0.37  
----------------------------------------------------------------------------
  SeaMicro acquistion costs         -       -     -       -      -       -  
----------------------------------------------------------------------------
  Tax benefit related to                                                    
   SeaMicro acquisition             -       -     -       -      -       -  
----------------------------------------------------------------------------
  Impairment charge on certain                                              
   marketable securities            -       -     -       -      4       -  
----------------------------------------------------------------------------
Non-GAAP net income (loss) /                                                
 Earnings (loss) per share       $ 45  $ 0.06  $ 31  $ 0.04  $(102) $(0.14) 
----------------------------------------------------------------------------
                                                                            
                                                                            

                                                               
                                -------------------------------
(Millions except per share                                     
 amounts)                            2013            2012      
---------------------------------------------------------------
GAAP net income (loss) /                                       
 Earnings (loss) per share      $ (83) $(0.11) $(1,183) $(1.60)
---------------------------------------------------------------
  Amortization of acquired                                     
   intangible assets               18    0.02       14    0.02 
---------------------------------------------------------------
  Restructuring and other                                      
   special charges (gains), net    30    0.04      100    0.14 
---------------------------------------------------------------
  Legal settlements, net          (48)  (0.06)       5    0.01 
---------------------------------------------------------------
  Limited waiver of exclusivity                                
   from GF                          -       -      703    0.95 
---------------------------------------------------------------
  Lower of cost or market charge                               
   related to GF take-or-pay                                   
   obligation                       -       -      273    0.37 
---------------------------------------------------------------
  SeaMicro acquistion costs         -       -        6    0.01 
---------------------------------------------------------------
  Tax benefit related to                                       
   SeaMicro acquisition             -       -      (36)  (0.05)
---------------------------------------------------------------
  Impairment charge on certain                                 
   marketable securities            -       -        4    0.01 
---------------------------------------------------------------
Non-GAAP net income (loss) /                                   
 Earnings (loss) per share      $ (83) $(0.11) $  (114) $(0.16)
---------------------------------------------------------------
                                                               
                                                               

About AMD
AMD (NYSE: AMD) designs and integrates technology that powers millions of intelligent devices, including personal computers, tablets, game consoles and cloud servers that define the new era of surround computing. AMD solutions enable people everywhere to realize the full potential of their favorite devices and applications to push the boundaries of what is possible. For more information, visit www.amd.com.

Cautionary Statement
This document contains forward-looking statements concerning AMD, its first quarter of 2014 revenue, AMD's long-term strategy, AMD's ability to diversify its business, and AMD's ability to leverage its IP in its core business and targeted growth areas; 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 presentation are based on current beliefs, assumptions and expectations, speak only as of the date of this presentation and involve risks and uncertainties that could cause actual results to differ materially from current expectations. Risks include the possibility that that Intel Corporation's pricing, marketing and rebating programs, product bundling, standard setting, new product introductions or other activities may negatively impact the Company's plans; that the Company will require additional funding and may be unable to raise sufficient capital on favorable terms, or at all; that customers stop buying the Company's products or materially reduce their operations or demand for its products; that the Company may be unable to develop, launch and ramp new products and technologies in the volumes that are required by the market at mature yields on a timely basis; that the Company's third-party foundry suppliers will be unable to transition the Company's products to advanced manufacturing process technologies in a timely and effective way or to manufacture the Company's products on a timely basis in sufficient quantities and using competitive process technologies; that the Company will be unable to obtain sufficient manufacturing capacity or components to meet demand for its products or will not fully utilize the Company's projected manufacturing capacity needs at GLOBALFOUNDRIES Inc. (GF) microprocessor manufacturing facilities; that the Company's requirements for wafers will be less than the fixed number of wafers that we agreed to purchase from GF or GF encounters problems that significantly reduce the number of functional die the Company receives from each wafer; that the Company is unable to successfully implement its long-term business strategy; that the Company inaccurately estimates the quantity or type of products that its customers will want in the future or will ultimately end up purchasing, resulting in excess or obsolete inventory; that the Company is unable to manage the risks related to the use of its third-party distributors and add-in-board (AIB) partners or offer the appropriate incentives to focus them on the sale of the Company's products; that the Company may be unable to maintain the level of investment in research and development that is required to remain competitive; that there may be unexpected variations in 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; that global business and economic conditions, including consumer PC market conditions, will not improve or will worsen; and the effect of political or economic instability, domestically or internationally, on the Company's sales or supply chain. Investors are urged to review in detail the risks and uncertainties in the Company's Securities and Exchange Commission filings, including but not limited to the Quarterly Report on Form 10-Q for the quarter ended September 28, 2013.

AMD, the AMD Arrow logo, AMD Opteron, AMD Radeon and combinations thereof, are trademarks of Advanced Micro Devices, Inc. Other names are for informational purposes only and used to identify companies and products and may be trademarks of their respective owner.

                                                                            
(1)  In this press release, in addition to GAAP financial results, the      
     company has provided non-GAAP financial measures including non-GAAP    
     gross margin, non-GAAP operating income (loss), non-GAAP net income    
     (loss) and non-GAAP earnings (loss) per share. These non-GAAP financial
     measures reflect certain adjustments as presented in the tables in this
     press release. The company also provided Adjusted EBITDA and non-GAAP  
     free cash flow as supplemental measures of its performance. These items
     are defined in the footnotes to the selected corporate data tables     
     provided at the end of this press release. The company is providing    
     these financial measures because it believes this non-GAAP presentation
     makes it easier for investors to compare its operating results for     
     current and historical periods and also because the Company believes it
     assists investors in comparing the company's performance across        
     reporting periods on a consistent basis by excluding items that it does
     not believe are indicative of its core operating performance and for   
     the other reasons described in the footnotes to the selected data      
     tables. Refer to corresponding tables at the end of this press release 
     for additional AMD data.                                               
                                                                            
(2)  The new 2014 AMD A-Series low power APU platform, codenamed "Mullins," 
     is expected to deliver up to 139 percent better productivity           
     performance per watt when compared to the previous generation "Temash" 
     platform. Testing conducted by AMD Performance Labs on optimized AMD   
     reference systems. PC manufacturers may vary configuration yielding    
     different results. PCMark 8 - Home score divided by TDP (W) is used to 
     simulate productivity performance per watt; the Mullins platform (4.5W)
     scored 1809 while the "Temash" platform (8W) scored 1343. AMD "Larne"  
     reference platform system used for both APUs. "Temash"-based AMD A6-   
     1450 quad-core APU with AMD Radeon™ HD 8250 Graphics, 2x2GB of DDR3-   
     1333MHz RAM (running at 1066MHz,) Windows 8.1, 13.200.11.0 - 03-Sep-   
     2013 driver. Pre-production engineering sample of "Mullins" quad-core  
     APU with next generation AMD Radeon graphics (model number TBD), 2x2GB 
     DDR3-1333MHz RAM, Windows 8.1, and unreleased reference driver. MUN-3  
                                                                            
(3)  The new 2014 AMD A-Series mainstream APU platform, codenamed "Beema,"  
     is expected to deliver up to 104 percent better productivity           
     performance-per-watt when compared to the previous generation "Kabini" 
     platform. Testing conducted by AMD Performance Labs on optimized AMD   
     reference systems. PC manufacturers may vary configuration yielding    
     different results. PCMark 8 - Home score divided by TDP (W) is used to 
     simulate productivity performance per watt; the "Beema" platform (15W) 
     scored 2312 while the "Kabini" platform (25W) scored 1861. AMD "Larne" 
     reference platform system used for both APUs. "Kabini"-based AMD A6-   
     5200 quad-core APU with AMD Radeon™ HD 8400 Graphics, 2x2GB of DDR3-   
     1600MHz RAM, Windows 8.1, 13.200.11.0 - 03-Sep-2013 driver. Pre-       
     production engineering sample of "Beema" quad-core APU with next       
     generation AMD Radeon graphics (model number TBD), 2x2GB DDR3-1600MHz  
     RAM, Windows 8.1, and unreleased reference driver. BMN-3               
                                                                            
                                                                            
                                                                            
ADVANCED MICRO DEVICES, INC.                                                
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS                             
(Millions except per share amounts and percentages)                         
                                                                            
                                   Quarter Ended             Year Ended     
-------------------------------------------------------  ------------------ 
                            Dec 28,  Sept 28,  Dec. 29,  Dec. 28,  Dec. 29, 
                             2013      2013      2012      2013      2012   
                                                                            
-------------------------------------------------------  ------------------ 
                                                                            
Net revenue                $  1,589  $  1,461  $  1,155  $  5,299  $  5,422 
                                                                            
Cost of sales                 1,036       940       977     3,321     4,187 
                                                                            
-------------------------------------------------------  ------------------ 
                                                                            
Gross margin                    553       521       178     1,978     1,235 
                                                                            
Gross margin %                   35%       36%       15%       37%       23%
                                                                            
Research and development        293       288       313     1,201     1,354 
                                                                            
Marketing, general and                                                      
 administrative                 169       155       193       674       823 
                                                                            
Amortization of acquired                                                    
 intangible assets                4         5         4        18        14 
                                                                            
Restructuring and other                                                     
 special charges (gains),                                                   
 net                              -       (22)       90        30       100 
                                                                            
Legal settlements, net          (48)        -         -       (48)        - 
                                                                            
-------------------------------------------------------  ------------------ 
                                                                            
Operating income (loss)         135        95      (422)      103    (1,056)
                                                                            
Interest income                   1         1         2         5         8 
Interest expense                (44)      (47)      (45)     (177)     (175)
Other income (expense),                                                     
 net                             (2)        2        (4)       (5)        6 
                                                                            
-------------------------------------------------------  ------------------ 
                                                                            
Income (loss) before                                                        
 income taxes                    90        51      (469)      (74)   (1,217)
                                                                            
Provision (benefit) for                                                     
 income taxes                     1         3         4         9       (34)
                                                                            
-------------------------------------------------------  ------------------ 
                                                                            
Net income (loss)          $     89  $     48  $   (473) $    (83) $ (1,183)
                                                                            
                                                                            
Net income (loss) per                                                       
 share                                                                      
                                                                            
  Basic                    $   0.12  $   0.06  $  (0.63) $  (0.11) $  (1.60)
                                                                            
  Diluted                  $   0.12  $   0.06  $  (0.63) $  (0.11) $  (1.60)
                                                                            
-------------------------------------------------------  ------------------ 
                                                                            
Shares used in per share                                                    
 calculation                                                                
                                                                            
  Basic                         759       757       747       754       741 
                                                                            
  Diluted                       766       764       747       754       741 
                                                                            
-------------------------------------------------------  ------------------ 
                                                                            
                                                                            
ADVANCED MICRO DEVICES, INC.                                                
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)            
(Millions)                                                                  
                                                                            
                                   Quarter Ended             Year Ended     
-------------------------------------------------------  ------------------ 
                            Dec 28,  Sept 28,  Dec. 29,  Dec. 28,  Dec. 29, 
                             2013      2013      2012      2013      2012   
                                                                            
-------------------------------------------------------  ------------------ 
                                                                            
Total comprehensive income                                                  
 (loss)                    $     89  $     52  $   (475) $    (82) $ (1,181)
                                                                            
-------------------------------------------------------  ------------------ 
                                                                            
                                                                            
ADVANCED MICRO DEVICES, INC.                                                
CONDENSED CONSOLIDATED BALANCE SHEETS                                       
(Millions)                                                                  
                                                                            
--------------------------------------------------------------------------- 
                                             Dec. 28,  Sept. 28,   Dec. 29, 
                                               2013       2013       2012   
                                                                            
--------------------------------------------------------------------------- 
                                                                            
Assets                                                                      
                                                                            
Current assets:                                                             
  Cash and cash equivalents                 $     869  $     543  $     549 
  Marketable securities                           228        517        453 
  Accounts receivable, net                        832        873        630 
  Inventories, net                                884        922        562 
  Prepaid expenses and other current assets        71         84         71 
                                                                            
--------------------------------------------------------------------------- 
                                                                            
      Total current assets                      2,884      2,939      2,265 
                                                                            
Long-term marketable securities                    90        121        181 
Property, plant and equipment, net                346        358        658 
Acquisition related intangible assets, net         78         82         96 
Goodwill                                          553        553        553 
Other assets                                      386        264        247 
--------------------------------------------------------------------------- 
                                                                            
Total Assets                                $   4,337  $   4,317  $   4,000 
=========================================================================== 
                                                                            
Liabilities and Stockholders' Equity                                        
                                                                            
Current liabilities:                                                        
  Short-term debt                           $      60  $       5  $       5 
  Accounts payable                                519        574        278 
  Payable to GLOBALFOUNDRIES                      364        495        454 
  Accrued and other current liabilities           530        549        552 
  Deferred income on shipments to                                           
   distributors                                   145        139        108 
                                                                            
--------------------------------------------------------------------------- 
                                                                            
      Total current liabilities                 1,618      1,762      1,397 
                                                                            
Long-term debt                                  1,998      2,044      2,037 
Other long-term liabilities                       177         77         28 
                                                                            
Stockholders' equity:                                                       
  Capital stock:                                                            
    Common stock, par value                         7          7          7 
    Additional paid-in capital                  6,894      6,872      6,803 
    Treasury stock, at cost                      (112)      (111)      (109)
  Accumulated deficit                          (6,243)    (6,332)    (6,160)
  Accumulated other comprehensive loss             (2)        (2)        (3)
                                                                            
--------------------------------------------------------------------------- 
                                                                            
      Total stockholders' equity                  544        434        538 
                                                                            
--------------------------------------------------------------------------- 
                                                                            
Total Liabilities and Stockholders' Equity  $   4,337  $   4,317  $   4,000 
=========================================================================== 
                                                                            
                                                                            
ADVANCED MICRO DEVICES, INC.                                                
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS                              
(Millions)                                                                  
                                               Quarter Ended    Year Ended  
------------------------------------------------------------  ------------- 
                                                  Dec. 28,       Dec. 28,   
                                                    2013           2013     
                                                                            
--------------------------------------------------------------------------- 
                                                                            
Cash flows from operating activities:                                       
  Net income (loss)                            $          89  $         (83)
  Adjustments to reconcile net income (loss)                                
   to net cash used in operating activities:                                
    Depreciation and amortization                         54            236 
    Net loss on disposal of property, plant                                 
     and equipment                                         1             31 
    Employee stock-based compensation expense             24             91 
    Non-cash interest expense                              7             25 
    Other                                                 (1)             - 
  Changes in operating assets and liabilities:                              
    Accounts receivable                                   42           (200)
    Inventories                                           38           (322)
    Prepaid expenses and other current assets              7            (11)
    Other assets                                        (143)          (210)
    Payable to GLOBALFOUNDRIES                          (130)           (89)
    Accounts payable, accrued liabilities and                               
     other                                                33            384 
------------------------------------------------------------  ------------- 
Net cash provided by (used in) operating                                    
 activities                                    $          21  $        (148)
------------------------------------------------------------  ------------- 
                                                                            
Cash flows from investing activities:                                       
  Purchases of property, plant and equipment             (21)           (84)
  Proceeds from sale of property, plant and                                 
   equipment                                               -            238 
  Purchases of available-for-sale securities             (58)        (1,043)
  Proceeds from sale and maturity of                                        
   available-for-sale securities                         375          1,344 
------------------------------------------------------------  ------------- 
Net cash provided by investing activities      $         296  $         455 
------------------------------------------------------------  ------------- 
                                                                            
Cash flows from financing activities:                                       
  Net proceeds from foreign grants and                                      
   allowances                                              5             11 
  Proceeds from issuance of common stock                   1              4 
  Proceeds from borrowings of secured                                       
   revolving line of credit, net                          55             55 
  Repayments of long-term debt and capital                                  
   lease obligations                                     (51)           (55)
  Other                                                   (1)            (2)
------------------------------------------------------------  ------------- 
Net cash provided by financing activities      $           9  $          13 
------------------------------------------------------------  ------------- 
Net increase in cash and cash equivalents                326            320 
------------------------------------------------------------  ------------- 
Cash and cash equivalents at beginning of                                   
 period                                        $         543  $         549 
------------------------------------------------------------  ------------- 
Cash and cash equivalents at end of period     $         869  $         869 
------------------------------------------------------------  ------------- 
                                                                            
ADVANCED MICRO DEVICES, INC.                                                
SELECTED CORPORATE DATA                                                     
(Millions except headcount)                                                 
                                                                            
                                                                            
                                   Quarter Ended             Year Ended     
-------------------------------------------------------- -------------------
                            Dec 28,  Sep. 28,  Dec. 29,   Dec 28,  Dec. 29, 
Segment and Category                                                        
 Information                 2013      2013      2012      2013      2012   
                                                                            
-------------------------------------------------------- -------------------
                                                                            
Computing Solutions (1)                                                     
  Net revenue              $    722  $    790  $    829  $  3,104  $  4,005 
  Operating income (loss)  $     (7) $     22  $   (323) $    (22) $   (231)
                                                                            
Graphics and Visual                                                         
 Solutions (2)                                                              
  Net revenue                   865       671       326     2,193     1,417 
  Operating income              121        79        22       216       105 
                                                                            
All Other (3)                                                               
  Net revenue                     2         -         -         2         - 
  Operating income (loss)        21        (6)     (121)      (91)     (930)
                                                                            
Total                                                                       
  Net revenue              $  1,589  $  1,461  $  1,155  $  5,299  $  5,422 
  Operating income (loss)  $    135  $     95  $   (422) $    103  $ (1,056)
                                                                            
-------------------------------------------------------- -------------------
                                                                            
Other Data                                                                  
                                                                            
Depreciation and                                                            
 amortization, excluding                                                    
 amortization of acquired                                                   
 intangible assets         $     50  $     52  $     62  $    219  $    247 
Capital additions          $     21  $     15  $     22  $     84  $    133 
Adjusted EBITDA (4)        $    165  $    153  $     30  $    412  $    389 
Cash, cash equivalents and                                                  
 marketable securities,                                                     
 including long-term                                                        
 marketable securities     $  1,187  $  1,181  $  1,183  $  1,187  $  1,183 
Non-GAAP free cash flow                                                     
 (5)                       $      0  $      6  $   (308) $   (232) $   (471)
Total assets               $  4,337  $  4,317  $  4,000  $  4,337  $  4,000 
Total debt                 $  2,058  $  2,049  $  2,042  $  2,058  $  2,042 
Headcount                    10,671    10,330    10,340    10,671    10,340 
                                                                            
-------------------------------------------------------- -------------------
                                                                            
                                                                            
 (1) Computing Solutions segment includes x86 microprocessors, as standalone
     devices or as incorporated as an accelerated processing unit (APU),    
     chipsets, embedded processors and dense servers.                       
                                                                            
 (2) Graphics and Visual Solutions segment includes graphics processing     
     units (GPU), including professional graphics, semi-custom products and 
     technology for game consoles.                                          
                                                                            
 (3) All Other category includes certain expenses and credits that are not  
     allocated to any of the operating segments. Also included in this      
     category are amortization of acquired intangible assets, employee      
     stock-based compensation expense, net restructuring and other special  
     charges (gains). In addition, the Company also included the following  
     for the indicated periods: for the fourth quarter of 2013 and for 2013,
     the Company included net legal settlements; for 2012, the Company      
     included a charge related to the limited waiver of exclusivity from    
     GLOBALFOUNDRIES (GF).  The Company also reported the results of former 
     businesses in the All Other category because the operating results were
     not material.                                                          
                                                                            
 (4) Reconciliation of GAAP operating income (loss) to Adjusted EBITDA*     
                                                                            
                                                                            
                                   Quarter Ended             Year Ended     
                           ----------------------------- -------------------
                           Dec. 28,  Sep. 28,  Dec. 29,  Dec. 28,  Dec. 29, 
                             2013      2013      2012      2013      2012   
                           ----------------------------- -------------------
     GAAP operating income                                                  
      (loss)               $    135  $     95  $   (422) $    103    (1,056)
       Lower of cost or                                                     
        market charge                                                       
        related to GF                                                       
        take-or-pay                                                         
        obligation                -         -       273         -       273 
       Limited waiver of                                                    
        exclusivity from                                                    
        GF                        -         -         -         -       703 
       Legal settlements,                                                   
        net                     (48)        -         -       (48)        5 
       Depreciation and                                                     
        amortization             50        52        62       219       247 
       Employee stock-                                                      
        based compensation                                                  
        expense                  24        23        23        91        97 
       Amortization of                                                      
        acquired                                                            
        intangible assets         4         5         4        17        14 
       Restructuring and                                                    
        other special                                                       
        charges (gains),                                                    
        net                       -       (22)       90        30       100 
       SeaMicro                                                             
        acquisition costs         -         -         -         -         6 
                           ----------------------------- -------------------
     Adjusted EBITDA       $    165  $    153  $     30  $    412  $    389 
                           ============================= ===================
                                                                            
                                                                            
(5)  Non-GAAP free cash flow reconciliation**                               
                                   Quarter Ended             Year Ended     
                           ----------------------------- -------------------
                           Dec. 28,  Sep. 28,  Dec. 29,  Dec. 28,  Dec. 29, 
                             2013      2013      2012      2013      2012   
                           ----------------------------- -------------------
     GAAP net cash                                                          
      provided by (used                                                     
      in) operating                                                         
      activities           $     21  $     21  $   (286) $   (148) $   (338)
       Purchases of                                                         
        property, plant                                                     
        and equipment           (21)      (15)      (22)      (84)     (133)
                           ----------------------------- -------------------
     Non-GAAP free cash                                                     
      flow                 $      0  $      6  $   (308) $   (232) $   (471)
                           ============================= ===================
                                                                            
                                                                            
     * 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 fourth   
      quarter of 2013, the Company included adjustments for net legal       
      settlements; for the third quarter of 2013, the Company included      
      adjustments for net restructuring and other special charges (gains);  
      for 2013, the Company included adjustments for net legal settlements  
      and net restructuring and other special charges (gains); for the      
      fourth quarter of 2012, the Company included adjustments for the      
      lower of cost or market charge (LCM Charge) related to GF take-or-pay 
      obligation and net restructuring and other special charges (gains);   
      for 2012, the Company included adjustments for the LCM Charge, a      
      charge related to the limited waiver of exclusivity from GF, net      
      legal settlements, net restructuring and other special charges        
      (gains) and SeaMicro, Inc acquisition 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.                              
                                                                            
     ** The Company also presents non-GAAP free cash flow in the earnings   
      release as a supplemental measure of its performance. Non-GAAP free   
      cash flow is determined by adjusting GAAP net cash provided by (used  
      in) operating activities for capital expenditures. The Company        
      calculates and communicates non-GAAP free cash flow in the financial  
      schedules because the Company's management believes it is of          
      importance to investors to understand the nature of these cash flows. 
      The Company's calculation of non-GAAP free cash flow may or may not   
      be consistent with the calculation of this measure by other companies 
      in the same industry. Investors should not view non-GAAP free cash    
      flow as an alternative to GAAP liquidity measures of cash flows from  
      operating activities. The Company has provided reconciliations within 
      the press release and financial schedules of these non-GAAP financial 
      measures to the most directly comparable GAAP financial measures.     
                                                                            

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Drew Prairie
512-602-4425

drew.prairie@amd.com

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