EXHIBIT 99
[AMD LETTERHEAD]
CONTACT:
Scott Allen
PUBLIC RELATIONS
(408) 749-3311
AMD Reports Second Quarter Results
SUNNYVALE, CA -- JULY 8, 1998 -- AMD today reported a net loss of
$64,560,000 on sales of $526,538,000 for its second quarter, ended June 28,
1998. The loss amounted to $0.45 per share.
Sales declined by 3 percent from the immediate-prior quarter, and by
11 percent from the second quarter of 1997. Sales for the first quarter of 1998
amounted to $540,856,000, which resulted in a net loss of $62,727,000, or $0.44
per share. In the second quarter of 1997, AMD reported sales of $594,561,000,
and net income of $9,968,000, or $0.07 per share, diluted.
For the first six months of 1998, AMD reported total revenues of
$1,067,394,000, a decline of 7 percent from the first six months of 1997, and a
net loss of $0.89 per share. For the same period a year ago, the company
reported revenues of $1,146,560,000, and net income of $22,919,000, or $0.16 per
share, diluted.
"The substantial growth in sales of AMD-K6(R) processors in the just-
completed quarter couldn't offset the decline in sales from our Communications
Group, our Memory Group, and Vantis(TM), our programmable logic company," said
W.J. Sanders III, chairman and chief executive officer. "Weakening demand in the
worldwide semiconductor industry, coupled with continued price pressures on
flash memory products, produced a substantial decline in revenues from our non-
microprocessor business units.
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"Our Computation Products Group had an excellent quarter," Sanders
continued. "Unit shipments of AMD-K6 family processors increased by more than
one million units over the immediate-prior quarter to nearly 2.7 million units.
We achieved a successful transition to 0.25-micron technology early in the
quarter. Approximately 40 percent of unit shipments during the just-completed
quarter were products manufactured on 0.25-micron technology. All of our
shipments of AMD-K6 processors in the current quarter will be on 0.25-micron
technology.
"On May 28 we successfully introduced our next-generation AMD-K6-2(R)
processor family with 3DNow! technology. The AMD-K6-2 processor is our first
differentiated processor for Microsoft(R) Windows(R) computing, and features
additional new instructions developed by AMD and supported by Microsoft to
enhance 3-D imaging and sound. We shipped more than 500,000 AMD-K6-2 processors
in the quarter, marking the steepest first-quarter sales ramp of a new processor
in AMD history. In response to demand from customers, we are rapidly shifting
production to AMD-K6-2 processors. Among others, IBM, Hewlett-Packard and
Fujitsu have announced desktop systems based on the AMD-K6-2 processor, and we
expect additional top-tier manufacturers to follow.
"Today, the world's top three and five of the top 10 manufacturers of
desktop PCs are now offering systems powered by AMD processors. We are
continuing efforts to expand our customer base to absorb the significant
increases in output we plan to achieve during the remainder of the year,"
Sanders concluded.
CAUTIONARY STATEMENT
Investors are cautioned that all forward-looking statements of
management's expectations involve risks and uncertainties that could cause
actual results to differ materially from current expectations.
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Any forward-looking statements about the AMD-K6 processor involve
risks and uncertainties, including whether: the company will be able to
significantly increase output of AMD-K6 processors, including higher-performance
AMD-K6-2 processors; the company will maintain or increase the current
production yields; the company will be successful in expanding its customer
base; customer demand for the AMD-K6 processors will continue at current or
greater levels; and worldwide economic conditions, including the economic
conditions in Asia, will change and affect demand for microprocessors and other
integrated circuits. Investors are urged to consult the risks and uncertainties
detailed in the company's reports filed with the Securities and Exchange
Commission.
ABOUT AMD
AMD is a global supplier of integrated circuits for the personal and
networked computer and communications markets. AMD produces processors, flash
memories, programmable logic devices, and products for communications and
networking applications. Founded in 1969 and based in Sunnyvale, California,
AMD had revenues of $2.4 billion in 1997. (NYSE: AMD).
--30--
WORLD WIDE WEB: Press announcements and other information about AMD are
available on the Internet via the World Wide Web. Type http:/www.amd.com at the
URL prompt.
3DNOW! AND VANTIS ARE TRADEMARKS OF ADVANCED MICRO DEVICES, INC.
AMD-K6, AMD-K6-2, AMD, the AMD logo and combinations thereof are registered
trademarks of Advanced Micro Devices, Inc.
Microsoft and Windows are a registered trademarks of Microsoft Corporation
ADVANCED MICRO DEVICES, INC.
CONSOLIDATED BALANCE SHEETS
(THOUSANDS)
June 28, December 28,
1998 1997
(Unaudited) (Audited)
- ------------------------------------------------------------------------------------------------------
ASSETS
- ------------------------------------------------------------------------------------------------------
Current assets:
Cash, cash equivalents and short-term investments $ 692,443 $ 467,032
Accounts receivable, net 239,602 329,111
Inventories 171,633 168,517
Deferred income taxes 168,841 160,583
Prepaid expenses and other current assets 55,135 50,024
- ------------------------------------------------------------------------------------------------------
Total current assets 1,327,654 1,175,267
Property, plant and equipment, net 2,163,009 1,990,689
Investment in joint venture 201,560 204,031
Other assets 166,361 145,284
- ------------------------------------------------------------------------------------------------------
$ 3,858,584 $ 3,515,271
======================================================================================================
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------------------------------------------------------------------------
Current liabilities:
Notes payable to banks $ 5,027 $ 6,601
Accounts payable 340,911 359,536
Accrued compensation and benefits 82,266 63,429
Accrued liabilities 142,574 134,656
Income tax payable 16,787 12,676
Deferred income on shipments to distributors 81,284 83,508
Current portion of long-term debt and capital
lease obligations 123,257 66,364
- ------------------------------------------------------------------------------------------------------
Total current liabilities 792,106 726,770
Deferred income taxes 5,461 96,269
Long-term debt and capital lease obligations,
less current portion 1,142,568 662,689
Stockholders' equity:
Capital stock:
Common stock, par value 1,445 1,428
Capital in excess of par value 1,044,074 1,018,884
Retained earnings 938,842 1,066,131
Accumulated other comprehensive income (65,912) (56,900)
- ------------------------------------------------------------------------------------------------------
Total stockholders' equity 1,918,449 2,029,543
- ------------------------------------------------------------------------------------------------------
$ 3,858,584 $ 3,515,271
=======================================================================================================
Advanced Micro Devices, Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Thousands except per share amounts)
Quarters Ended Six Months Ended
(Unaudited) (Unaudited)
- -------------------------------------------------------------------------------------------------------------------------------
June 28, Mar. 29, June 29, June 28, June 29,
1998 1998 1997 1998 1997
- -------------------------------------------------------------------------------------------------------------------------------
NET SALES $ 526,538 $ 540,856 $ 594,561 $1,067,394 $1,146,560
Cost of sales 390,140 423,591 372,266 813,731 721,342
Research and development 139,158 128,120 110,021 267,278 214,929
Marketing, general and
administrative 101,198 88,214 102,983 189,412 197,502
- -------------------------------------------------------------------------------------------------------------------------------
630,496 639,925 585,270 1,270,421 1,133,773
- -------------------------------------------------------------------------------------------------------------------------------
Operating income (loss) (103,958) (99,069) 9,291 (203,027) 12,787
Litigation settlement - (11,500) - (11,500) -
Interest income and other, net 8,518 5,581 9,718 14,099 23,040
Interest expense (17,663) (12,472) (9,958) (30,135) (19,368)
- -------------------------------------------------------------------------------------------------------------------------------
Income (loss) before income taxes
and equity in joint venture (113,103) (117,460) 9,051 (230,563) 16,459
Provision (benefit) for income
taxes (44,110) (46,997) 2,630 (91,107) 4,778
- -------------------------------------------------------------------------------------------------------------------------------
Income (loss) before equity
in joint venture (68,993) (70,463) 6,421 (139,456) 11,681
Equity in net income of
joint venture 4,433 7,736 3,547 12,169 11,238
- -------------------------------------------------------------------------------------------------------------------------------
NET INCOME (LOSS) $ (64,560) $ (62,727) $ 9,968 $ (127,287) $ 22,919
- -------------------------------------------------------------------------------------------------------------------------------
NET INCOME (LOSS) PER COMMON
SHARE
- Basic $ (0.45) $ (0.44) $ 0.07 $ (0.89) $ 0.16
- Diluted $ (0.45) $ (0.44) $ 0.07 $ (0.89) $ 0.16
- -------------------------------------------------------------------------------------------------------------------------------
Shares used in per share
calculation
- Basic 143,462 142,503 140,255 142,983 139,435
- Diluted 143,462 142,503 147,919 142,983 147,335
- -------------------------------------------------------------------------------------------------------------------------------
Advanced Micro Devices, Inc. INFORMATION ONLY
- -------------------------------------------------------------------------------
NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS*
(Includes Pre-Tax FASL Investment Equity Income in Operating Income (Loss))
- --------------------------------------------------------------------------------
(Thousands except per share amounts)
Quarters Ended Six Months Ended
(Unaudited) (Audited)
- ---------------------------------------------------------------------------------------------------------------------------------
June 28, Mar. 29, June 29, June 28, June 29,
1998 1998 1997 1998 1997
- ---------------------------------------------------------------------------------------------------------------------------------
NET SALES $ 526,538 $ 540,856 $ 594,561 $1,067,394 $1,146,560
Cost of sales 390,140 423,591 372,266 813,731 721,342
Income from equity
investment in FASL (7,416) (15,988) (7,256) (23,404) (19,738)
Research and development 139,158 128,120 110,021 267,278 214,929
Marketing, general and
administrative 101,198 88,214 102,983 189,412 197,502
- ---------------------------------------------------------------------------------------------------------------------------------
623,080 623,937 578,014 1,247,017 1,114,035
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Operating income (loss) (96,542) (83,081) 16,547 (179,623) 32,525
Litigation settlement - (11,500) - (11,500) -
Interest income and other, net 8,518 5,581 9,718 14,099 23,040
Interest expense (17,663) (12,472) (9,958) (30,135) (19,368)
- ---------------------------------------------------------------------------------------------------------------------------------
Income (loss) before income taxes (105,687) (101,472) 16,307 (207,159) 36,197
Provision (benefit) for income
taxes (44,110) (46,997) 2,630 (91,107) 4,778
Provision for taxes on equity
income in FASL 2,983 8,252 3,709 11,235 8,500
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NET INCOME (LOSS) $ (64,560) $ (62,727) $ 9,968 $ (127,287) $ 22,919
- ---------------------------------------------------------------------------------------------------------------------------------
NET INCOME (LOSS) PER COMMON
SHARE
- Basic $ (0.45) $ (0.44) $ 0.07 $ (0.89) $ 0.16
- Diluted $ (0.45) $ (0.44) $ 0.07 $ (0.89) $ 0.16
- ---------------------------------------------------------------------------------------------------------------------------------
Shares used in per share
calculation
- Basic 143,462 142,503 140,255 142,983 139,435
- Diluted 143,462 142,503 147,919 142,983 147,335
- ---------------------------------------------------------------------------------------------------------------------------------
* The above statements of operations are not in accordance with generally
accepted accounting principles (GAAP) in that the pre-tax equity income of
FASL has been reclassified and included in the determination of operating
income (loss). Net income (loss) and related net income (loss) per common
share amounts are the same as those reported under GAAP.
AMD
SELECTED CORPORATE DATA
(UNAUDITED)
PRODUCT LINE BREAKDOWN Q2 '98 Q1 '98 Q2 '97
- ---------------------- ----------------------- ----------------------- -----------------------
% OF SALES REVENUE % OF SALES REVENUE % OF SALES REVENUE
- ---------------------------- ---------- ------- ----------- ------- ---------- -------
Communications Group
(CPD, EPD, NPD) 23 $123M 28 $149M 31 $183M
Vantis (PLD) 10 52M 10 56M 10 57M
Memory Group (MG) 25 132M 31 167M 30 181M
Computation Products Group
(CMD, PPD, TMD) 42 220M 31 169M 29 174M
- -----------------------------------------------------------------------------------------------------------------------
OTHER DATA Q2 '98 Q1 '98 Q2 '97
- ---------- ------ ------ ------
Depreciation
and Amortization $ 113M $ 112M* $ 94M
Capital Additions 314M 181M* 160M
Headcount 13,313 12,936 12,382
- -----------------------------------------------------------------------------------------------------------------------
International Sales 48% 55% 54%
* Restated from Q1 '98.