AMD Reports 2016 Second Quarter Results

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1.   In this earnings press release, in addition to GAAP financial results, 
     AMD has provided non-GAAP financial measures including non-GAAP gross  
     margin, non-GAAP operating income (loss), non-GAAP operating expenses, 
     non-GAAP net income (loss) and non-GAAP earnings (loss) per share.     
     These non-GAAP financial measures reflect certain adjustments as       
     presented in the tables in this earnings press release. AMD also       
     provided adjusted EBITDA and non-GAAP free cash flow as supplemental   
     measures of its performance. These items are defined in the footnotes  
     to the selected corporate data tables provided at the end of this      
     earnings press release. AMD is providing these financial measures      
     because it believes this non-GAAP presentation makes it easier for     
     investors to compare its operating results for current and historical  
     periods and also because AMD believes it assists investors in comparing
     AMD's performance across reporting periods on a consistent basis by    
     excluding items that it does not believe are indicative of its core    
     operating performance and for the other reasons described in the CFO   
     Commentary.                                                            
                                                                            
                                                                            
ADVANCED MICRO DEVICES, INC.                                                
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS                             
(Millions except per share amounts and percentages)                         
                                                                            
                                Three Months Ended        Six Months Ended  
                          -----------------------------  ------------------ 
                          June 25,  March 26,  June 27,  June 25,  June 27, 
                            2016       2016      2015      2016      2015   
                          --------  ---------  --------  --------  -------- 
Net revenue               $  1,027  $     832  $    942  $  1,859  $  1,972 
Cost of sales                  708        563       710     1,271     1,414 
                          --------  ---------  --------  --------  -------- 
Gross margin                   319        269       232       588       558 
Gross margin %                  31%        32%       25%       32%       28%
Research and development       243        242       235       485       477 
Marketing, general and                                                      
 administrative                117        105       134       222       265 
Amortization of acquired                                                    
 intangible assets               -          -              -                  -                  3  
Restructuring  and  other                                                                                                          
  special  charges,  net                      (7)                (3)                -              (10)              87  
Licensing  gain                                  (26)                (7)                -              (33)                -  
                                                    --------    ---------    --------    --------    --------  
Operating  loss                                    (8)              (68)          (137)            (76)          (274)
Interest  expense                              (41)              (40)            (40)            (81)            (80)
Other  income  (expense),                                                                                                          
  net                                                      150                    -                (3)            150                (3)
                                                    --------    ---------    --------    --------    --------  
Income  (loss)  before                                                                                                                
  equity  loss  and  income                                                                                                          
  taxes                                                  101              (108)          (180)              (7)          (357)
Provision  for  income                                                                                                                
  taxes                                                    29                    1                  1                30                  4  
Equity  in  income  (loss)                                                                                                          
  of  ATMP  JV                                          (3)                  -                  -                (3)                -  
                                                    --------    ---------    --------    --------    --------  
Net  income  (loss)                  $          69    $        (109)  $      (181)  $        (40)  $      (361)
Net  income  (loss)  per                                                                                                              
  share                                                                                                                                            
    Basic                                      $      0.09    $      (0.14)  $    (0.23)  $    (0.05)  $    (0.46)
    Diluted                                  $      0.08    $      (0.14)  $    (0.23)  $    (0.05)  $    (0.46)
                                                    --------    ---------    --------    --------    --------  
Shares  used  in  per  share                                                                                                        
  calculation                                                                                                                                
    Basic                                                794                793              778              794              778  
    Diluted                                            821                793              778              794              778  
                                                    --------    ---------    --------    --------    --------  
                                                                                                                                                        
ADVANCED  MICRO  DEVICES,  INC.                                                                                                
CONDENSED  CONSOLIDATED  STATEMENTS  OF  COMPREHENSIVE  INCOME  (LOSS)                        
(Millions)                                                                                                                                    
                                                                                                                                                        
                                                                Three  Months  Ended                Six  Months  Ended    
                                                    -----------------------------    ------------------  
                                                    June  25,    March  26,    June  27,    June  25,    June  27,  
                                                        2016              2016            2015            2016            2015      
                                                    --------    ---------    --------    --------    --------  
Total  comprehensive                                                                                                                  
  income  (loss)                        $          72    $        (107)  $      (174)  $        (35)  $      (361)
                                                    --------    ---------    --------    --------    --------  
                                                                                                                                                        
                                                                                                                                                        
                                                                                                                                                        
ADVANCED  MICRO  DEVICES,  INC.                                                                                                
CONDENSED  CONSOLIDATED  BALANCE  SHEETS  (1)  (2)                                                              
(Millions)                                                                                                                                    
                                                                                                                                                        
                                                                                June  25,      March  26,      December  26,  
                                                                                    2016                2016                  2015          
                                                                              ----------    ----------    ------------  
Assets                                                                                                                                            
Current  assets:                                                                                                                          
    Cash  and  cash  equivalents                        $            957    $            716    $                785  
    Accounts  receivable,  net                                        671                  508                      533  
    Inventories,  net                                                        743                  675                      678  
    Prepayment  and  other  -                                                                                                        
      GLOBALFOUNDRIES                                                          12                    26                        33  
    Prepaid  expenses                                                          68                    49                        43  
    Other  current  assets                                                  55                  252                      248  
                                                                                                                                                        
                                                                              ----------    ----------    ------------  
        Total  current  assets                                        2,506              2,226                  2,320  
Property,  plant  and  equipment,  net                        169                  176                      188  
Goodwill                                                                            289                  278                      278  
Investment  in  ATMP  JV                                                    62                      -                          -  
Other  assets                                                                    290                  301                      298  
                                                                              ----------    ----------    ------------  
Total  Assets                                                      $        3,316    $        2,981    $            3,084  
                                                                              ==========    ==========    ============  
                                                                                                                                                        
Liabilities  and  Stockholders'  Equity                                                                                
  (Deficit)                                                                                                                                    
Current  liabilities:                                                                                                                
    Short-term  debt                                            $            226    $            230    $                230  
    Accounts  payable                                                        616                  324                      279  
    Payable  to  GLOBALFOUNDRIES                                      94                  233                      245  
    Payable  to  ATMP  JV                                                    150                      -                          -  
    Accrued  liabilities                                                  392                  347                      472  
    Other  current  liabilities                                        61                  151                      124  
    Deferred  income  on  shipments  to                                                                                      
      distributors                                                                42                    43                        53  
                                                                                                                                                        
                                                                              ----------    ----------    ------------  
        Total  current  liabilities                              1,581              1,328                  1,403  
Long-term  debt                                                            2,012              2,006                  2,007  
Other  long-term  liabilities                                      136                  150                        86  
                                                                                                                                                        
Stockholders'  equity  (deficit):                                                                                          
    Capital  stock:                                                                                                                        
        Common  stock,  par  value                                          8                      8                          8  
        Additional  paid-in  capital                            7,053              7,033                  7,017  
        Treasury  stock,  at  cost                                    (125)              (123)                  (123)
    Accumulated  deficit                                            (7,346)          (7,415)              (7,306)
    Accumulated  other  comprehensive  loss                  (3)                  (6)                      (8)
                                                                                                                                                        
                                                                              ----------    ----------    ------------  
        Total  Stockholders'  equity                                                                                            
          (deficit)                                                              (413)              (503)                  (412)
                                                                              ----------    ----------    ------------  
Total  Liabilities  and  Stockholders'                                                                                  
  Equity  (Deficit)                                            $        3,316    $        2,981    $            3,084  
                                                                              ==========    ==========    ============  
                                                                                                                                                        
(1)  Amounts  reflected  adoption  of  FASB  ASU  2015-17,  Balance  Sheet                      
        Classification  of  Deferred  Taxes  beginning  in  the  first  quarter  of  2016.
(2)  Amounts  reflected  adoption  of  FASB  ASU  2015-03,  Simplifying  the                  
        Presentation  of  Debt  Issuance  Costs  beginning  in  the  first  quarter  of      
        2016.                                                                                                                                      
                                                                                                                                                        
                                                                                                                                                        
                                                                                                                                                        
ADVANCED  MICRO  DEVICES,  INC.                                                                                                
CONDENSED  CONSOLIDATED  STATEMENT  OF  CASH  FLOWS                                                            
(Millions)                                                                                                                                    
                                                                                                                                                        
                                                                                                  Three  Months      Six  Months    
                                                                                                          Ended                  Ended        
                                                                                                  ------------    ------------  
                                                                                                      June  25,            June  25,      
                                                                                                          2016                    2016          
                                                                                                  ------------    ------------  
                                                                                                                                                        
Cash  flows  from  operating  activities:                                                                              
    Net  income  (loss)                                                            $                  69    $                (40)
    Adjustments  to  reconcile  net  income  (loss)  to                                                          
      net  cash  used  in  operating  activities:                                                                      
        Gain  on  sale  of  equity  interests  in  ATMP  JV                    (150)                  (150)
        Equity  in  income  (loss)  of  ATMP  JV                                          (1)                      (1)
        Depreciation  and  amortization                                                    33                        66  
        Provision  for  deferred  income  taxes                                        11                        11  
        Stock-based  compensation  expense                                              18                        34  
        Non-cash  interest  expense                                                              3                          7  
        Other                                                                                                    (1)                      (6)
    Changes  in  operating  assets  and  liabilities:                                                            
        Accounts  receivable                                                                    (164)                  (138)
        Inventories                                                                                      (69)                    (66)
        Prepayment  and  other  -  GLOBALFOUNDRIES                                  14                        21  
        Prepaid  expenses  and  other  assets                                        (139)                  (117)
        Payable  to  ATMP  JV                                                                        150                      150  
        Payable  to  GLOBALFOUNDRIES                                                      (139)                  (151)
        Accounts  payable,  accrued  liabilities  and                                                              
          other                                                                                                280                      253  
                                                                                                  ------------    ------------  
Net  cash  used  in  operating  activities                        $                (85)  $              (127)
                                                                                                  ------------    ------------  
                                                                                                                                                        
Cash  flows  from  investing  activities:                                                                              
    Purchases  of  property,  plant  and  equipment                            (21)                    (47)
    Proceeds  from  sale  of  equity  interests  in  ATMP                                                        
      JV                                                                                                          351                      351  
    Other                                                                                                        (1)                      (1)
                                                                                                  ------------    ------------  
Net  cash  provided  by  investing  activities                $                329    $                303  
                                                                                                  ------------    ------------  
                                                                                                                                                        
Cash  flows  from  financing  activities:                                                                              
    Proceeds  from  issuance  of  common  stock                                        2                          2  
    Repayments  of  borrowings,  net                                                        (4)                      (4)
    Other                                                                                                        (1)                      (2)
                                                                                                  ------------    ------------  
Net  cash  used  in  financing  activities                        $                  (3)  $                  (4)
                                                                                                  ------------    ------------  
Net  increase  in  cash  and  cash  equivalents                                  241                      172  
                                                                                                  ------------    ------------  
Cash  and  cash  equivalents  at  beginning  of  period  $                716    $                785  
                                                                                                  ------------    ------------  
Cash  and  cash  equivalents  at  end  of  period              $                957    $                957  
                                                                                                  ------------    ------------  
                                                                                                                                                        
                                                                                                                                                        
                                                                                                                                                        
ADVANCED  MICRO  DEVICES,  INC.                                                                                                
SELECTED  CORPORATE  DATA                                                                                                          
(Millions  except  headcount)                                                                                                  
                                                                Three  Months  Ended                  Six  Months  Ended  
--------------------------------------------------------  -------------------
Segment  and  Category            June  25,    March  26,    June  27,    June  25,    June  27,  
  Information                                  2016            2016              2015            2016            2015    
--------------------------------------------------------  -------------------
                                                                                                                                                        
    Computing  and  Graphics                                                                                                        
      (1)                                                                                                                                            
        Net  revenue                      $        435    $          460    $        379    $        895    $        911  
        Operating  loss                $        (81)  $          (70)  $      (147)  $      (151)  $      (222)
                                                                                                                                                        
    Enterprise,  Embedded                                                                                                            
      and  Semi-Custom  (2)                                                                                                            
        Net  revenue                      $        592    $          372    $        563    $        964    $    1,061  
        Operating  income            $          84    $            16    $          27    $        100    $          72  
                                                                                                                                                        
    All  Other  (3)                                                                                                                          
        Net  revenue                                    -                    -                  -                  -                  -  
        Operating  loss                $        (11)  $          (14)  $        (17)  $        (25)  $      (124)
                                                                                                                                                        
    Total                                                                                                                                          
        Net  revenue                      $    1,027    $          832    $        942    $    1,859    $    1,972  
        Operating  loss                $          (8)  $          (68)  $      (137)  $        (76)  $      (274)
                                                                                                                                                        
--------------------------------------------------------  -------------------
                                                                                                                                                        
Other  Data                                                                                                                                    
                                                                                                                                                        
    Depreciation  and                                                                                                                    
      amortization,                                                                                                                        
      excluding  amortization                                                                                                      
      of  acquired  intangible                                                                                                      
      assets                                  $          33    $            33    $          45    $          66    $          88  
    Capital  additions              $          21    $            26    $          17    $          47    $          39  
    Adjusted  EBITDA  (4)          $          36    $          (22)  $        (42)  $          14    $        (29)
    Cash  and  cash                                                                                                                          
      equivalents                        $        957    $          716    $        829    $        957    $        829  
    Non-GAAP  free  cash  flow                                                                                                      
      (5)                                        $      (106)  $          (68)  $        (74)  $      (174)  $      (268)
    Total  assets                        $    3,316    $      2,981    $    3,353    $    3,316    $    3,353  
    Total  debt                            $    2,238    $      2,236    $    2,241    $    2,238    $    2,241  
    Headcount                                    8,099            9,047          9,469          8,099          9,469  
--------------------------------------------------------  -------------------
                                                                                                                                                        
 

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