SUNNYVALE, CA — (Mar­ket­wired) — 07/06/15 – AMD (NASDAQ: AMD) today announ­ced that reve­nue for the second quar­ter ended June 27, 2015 is expec­ted to be lower than pre­vious­ly gui­ded. The com­pa­ny now expects second quar­ter reve­nue to decrease appro­xi­m­ate­ly 8 per­cent sequen­ti­al­ly, com­pared to the pre­vious gui­dance of down 3 per­cent, plus or minus 3 per­cent. The sequen­ti­al decrease is pri­ma­ri­ly due to wea­k­er than expec­ted con­su­mer PC demand impac­ting the company’s Ori­gi­nal Equip­ment Manu­fac­tu­rer (OEM) APU sales. The com­pa­ny expects second quar­ter chan­nel sales and chan­nel inven­to­ry reduc­tion efforts to be in-line with the company’s plans.

The com­pa­ny anti­ci­pa­tes non-GAAP gross mar­gin to be appro­xi­m­ate­ly 28 per­cent, com­pared to the pre­vious non-GAAP gui­dance of appro­xi­m­ate­ly 32 per­cent pri­ma­ri­ly due to a hig­her mix of Enter­pri­se, Embedded and Semi-Cus­tom seg­ment sales and lower than anti­ci­pa­ted Com­pu­ting and Gra­phics seg­ment APU unit volu­mes due to wea­k­er than expec­ted OEM PC pro­duct demand. Addi­tio­nal­ly the com­pa­ny anti­ci­pa­tes GAAP gross mar­gin to be fur­ther impac­ted by a one-time char­ge of appro­xi­m­ate­ly $33 mil­li­on asso­cia­ted with a tech­no­lo­gy node tran­si­ti­on from 20 nano­me­ter (nm) to Fin­FET. The com­pa­ny star­ted seve­ral pro­duct designs in 20nm that will ins­tead tran­si­ti­on to the lea­ding-edge Fin­FET node.

Cash and cash equi­va­lents at the end of the second quar­ter are expec­ted to be appro­xi­m­ate­ly $830 mil­li­on, in line with expectations.

AMD will report second quar­ter 2015 results after mar­ket clo­se on Thurs­day, July 16, 2015. AMD will hold a con­fe­rence call for the finan­cial com­mu­ni­ty at 2:30 p.m. PT (5:30 p.m. ET) that day to dis­cuss second quar­ter finan­cial results and to pro­vi­de infor­ma­ti­on regar­ding expec­ted third quar­ter results. AMD will pro­vi­de a real-time audio broad­cast of the tele­con­fe­rence on the Inves­tor Rela­ti­ons page at http://www.amd.com. The web­cast will be available for 10 days after the con­fe­rence call.

About AMD
AMD (NASDAQ: 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.

AMD and the AMD Arrow logo are trade­marks of Advan­ced Micro Devices, Inc. 

AMD’s con­so­li­da­ted finan­cial data for the quar­ter ended June 27, 2015 has not been fina­li­zed. AMD’s expec­ta­ti­ons with respect to the preli­mi­na­ry unau­di­ted results for the second quar­ter dis­cus­sed abo­ve are based upon its esti­ma­tes and sub­ject to com­ple­ti­on of its finan­cial clo­sing pro­ce­du­res. This sum­ma­ry is not a com­pre­hen­si­ve state­ment of AMD’s finan­cial results for this peri­od, and AMD’s actu­al results upon com­ple­ti­on of AMD’s finan­cial clo­se pro­ce­du­res may dif­fer mate­ri­al­ly from the­se esti­ma­tes. This press release con­ta­ins for­ward-loo­king state­ments con­cer­ning AMD, its second quar­ter 2015 reve­nue, chan­nel sales, gross mar­gin, non-GAAP gross mar­gin and its cash and cash equi­va­lent balan­ces, 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 that Intel Corporation’s domi­nan­ce of the micro­pro­ces­sor mar­ket and its aggres­si­ve busi­ness prac­ti­ces may limit AMD’s abili­ty to com­pe­te effec­tively; that AMD reli­es on Glo­bal­Found­ries Inc. (GF) to manu­fac­tu­re most of its micro­pro­ces­sor and APU pro­ducts and cer­tain of its GPU and semi-cus­tom pro­ducts. If GF is not able to satis­fy its manu­fac­tu­ring requi­re­ments, AMD’s busi­ness could be adver­se­ly impac­ted; that AMD reli­es on third par­ties to manu­fac­tu­re its pro­ducts, and if they are unable to do so on a time­ly basis in suf­fi­ci­ent quan­ti­ties and using com­pe­ti­ti­ve tech­no­lo­gies, AMD’s busi­ness could be mate­ri­al­ly adver­se­ly affec­ted; fail­ure to achie­ve expec­ted manu­fac­tu­ring yields for AMD’s pro­ducts could nega­tively impact its finan­cial results; the suc­cess of its busi­ness is depen­dent upon its abili­ty to intro­du­ce pro­ducts on a time­ly basis with fea­tures and per­for­mance levels that pro­vi­de value to its cus­to­mers while sup­port­ing and coin­ci­ding with signi­fi­cant indus­try tran­si­ti­ons; if AMD can­not gene­ra­te suf­fi­ci­ent reve­nue and ope­ra­ting cash flow or obtain exter­nal finan­cing, it may face a cash short­fall and be unable to make all of its plan­ned invest­ments in rese­arch and deve­lo­p­ment or other stra­te­gic invest­ments; that AMD may not be able to suc­cessful­ly imple­ment its busi­ness stra­tegy to refo­cus its busi­ness to address mar­kets bey­ond AMD’s core PC mar­ket to high-growth adja­cent mar­kets; the com­ple­ti­on and impact of the 2014 res­truc­tu­ring plan and its trans­for­ma­ti­on initia­ti­ves could adver­se­ly affect AMD; glo­bal eco­no­mic uncer­tain­ty may adver­se­ly impact AMD’s busi­ness and ope­ra­ting results; AMD may not be able to gene­ra­te suf­fi­ci­ent cash to ser­vice its debt obli­ga­ti­ons or meet its working capi­tal requi­re­ments; AMD has a sub­stan­ti­al amount of indeb­ted­ness which could adver­se­ly affect its finan­cial posi­ti­on and pre­vent it from imple­men­ting its stra­tegy or ful­fil­ling its con­trac­tu­al obli­ga­ti­ons; the agree­ments gover­ning AMD’s notes and its amen­ded and resta­ted seni­or secu­red asset based line of cre­dit for a prin­ci­pal amount up to $500 mil­li­on (Secu­red Revol­ving Line of Cre­dit) impo­se rest­ric­tions on AMD that may adver­se­ly affect AMD’s abili­ty to ope­ra­te its busi­ness; the mar­kets in which AMD’s pro­ducts are sold are high­ly com­pe­ti­ti­ve; the loss of a signi­fi­cant cus­to­mer may have a mate­ri­al adver­se effect on it; AMD’s receipt of reve­nue from its semi-cus­tom SoC pro­ducts is depen­dent upon AMD’s tech­no­lo­gy being desi­gned into third-par­ty pro­ducts and the suc­cess of tho­se pro­ducts; the demand for AMD’s pro­ducts depends in part on the mar­ket con­di­ti­ons in the indus­tries into which they are sold. Fluc­tua­tions in demand for AMD’s pro­ducts or a mar­ket decli­ne in any of the­se indus­tries could have a mate­ri­al adver­se effect on AMD’s results of ope­ra­ti­ons; AMD’s abili­ty to design and intro­du­ce new pro­ducts in a time­ly man­ner is depen­dent upon third-par­ty intellec­tu­al pro­per­ty; AMD depends on third-par­ty com­pa­nies for the design, manu­fac­tu­re and sup­p­ly of mother­boards, BIOS soft­ware and other com­pu­ter plat­form com­pon­ents to sup­port its busi­ness; if AMD loses Micro­soft Corporation’s sup­port for its pro­ducts or other soft­ware ven­dors do not design and deve­lop soft­ware to run on AMD’s pro­ducts, its abili­ty to sell AMD pro­ducts could be mate­ri­al­ly adver­se­ly affec­ted; AMD may incur future impairm­ents of good­will; uncer­tain­ties invol­ving the orde­ring and ship­ment of AMD’s pro­ducts could mate­ri­al­ly adver­se­ly affect AMD; AMD’s reli­ance on third-par­ty dis­tri­bu­tors and AIB part­ners sub­jects AMD to cer­tain risks; AMD’s ina­bi­li­ty to con­ti­nue to attract and retain qua­li­fied per­son­nel may hin­der its pro­duct deve­lo­p­ment pro­grams; in the event of a chan­ge of con­trol, AMD may not be able to repurcha­se all of the out­stan­ding debt as requi­red by the appli­ca­ble inden­tures and its Secu­red Revol­ving Line of Cre­dit, which would result in a default under the inden­tures and its Secu­red Revol­ving Line of Cre­dit; and the semi­con­duc­tor indus­try is high­ly cycli­cal and has expe­ri­en­ced seve­re down­turns that have mate­ri­al­ly adver­se­ly affec­ted, and may con­ti­nue to mate­ri­al­ly adver­se­ly affect, AMD’s busi­ness in the future. Inves­tors are urged to review in detail the risks and uncer­tain­ties in AMD’s Secu­ri­ties and Exch­an­ge Com­mis­si­on filings, inclu­ding but not limi­t­ed to AMD’s Quar­ter­ly Report on Form 10‑Q for the quar­ter ended March 28, 2015.

Source: Advan­ced Micro Devices