AMD REPORTS THIRD QUARTER RESULTS
AMD reports record sales, record operating income, and record net
$409 million; sales up by 82 percent from third quarter of 1999 -
SUNNYVALE, CA - October 11, 2000 - AMD today reported record sales
of $1,206,549,000, record operating income of $262,844,000, and record net
income of $408,567,000 for the quarter ended October 1, 2000. Net income
amounted to $1.18 per diluted share. The company's third-quarter results
included a one-time gain of $336,899,000 resulting from the sale of the
company's voice communications business (Legerity) during the quarter, and
charges of $22,980,000 relating to the retirement of senior secured notes.
Net income excluding one-time gains and charges was $219,301,000, or $0.64
per diluted share, also a record.
Aggregate sales of the company's flagship products - PC processors and flash
memory devices - more than doubled from the third quarter of 1999, and grew
by more than 10 percent sequentially from the second quarter of 2000. Total
sales grew by 82 percent from the third quarter of 1999. Notwithstanding the
absence of sales from the company's voice communications business, which was
sold during the quarter, total sales grew by slightly more than 3 percent
from the immediate-prior quarter.
In the immediate-prior quarter, AMD reported sales of $1,170,437,000,
operating income of $250,197,000, and net income of $207,142,000, or $0.60
per diluted share. In the like period of 1999, AMD reported sales of
$662,192,000, an operating loss of $98,990,000, and net loss of
$105,545,000, or a loss of $0.36 per share.
For the first nine months of 2000, AMD reported sales of
$3,469,015,000, operating income of $693,710,000, and net income of
$805,058,000, or $2.36 per diluted share. For the same period of 1999, AMD
reported total sales of $1,888,894,000, an operating loss of $392,642,000, a
net loss of $154,016,000, or a loss of $0.52 per share. The results for the
first nine months of 1999 included a one-time, after-tax gain of
$259,236,000 from the sale of Vantis Corporation, and restructuring and
other special charges of $32,530,000.
The earnings per share and number of shares used in the
earnings-per-share data for all periods presented reflect the two-for-one
stock split that was effective August 21, 2000.
"Sales growth was led by continuing extraordinary demand for AMD
flash memory devices, whose sales more than doubled over the same period of
1999 and grew by 17 percent sequentially on record unit sales," said W.J.
Sanders III, chairman and chief executive officer. "Demand for AMD flash
memory products continues to exceed supply. Demand also continues to be
broadly based, reflecting strength in cellular telephones, set-top boxes,
automotive applications, Internet infrastructure products, and mobile
"In a tougher market than anticipated, AMD achieved record PC
processor revenues on record unit sales, which were up more than 50 percent
year-on-year and 10 percent sequentially," Sanders said. "We continued our
excellent operational execution and met our aggressive goal of sequentially
doubling combined AMD Athlon* and AMD Duron* processor sales to more than
3.6 million units. Our position as the reliable provider of the world's
fastest PC processors contributed immensely to our success in gaining market
share worldwide, particularly in the performance sector.
"The newest version of the AMD Athlon processor, featuring
performance-enhancing on-chip L2 cache memory, is an overwhelming success,
and demand remains strong. The recently introduced AMD Duron processor is
the performance leader in the value space, and is on the steepest ramp of
unit shipments of any processor in AMD's history. We continue to work
closely with our customers and infrastructure partners to meet the challenge
of providing the best performing personal computers at all price points,"
The company's total bookings in the third quarter were a record, with a
book-to-bill ratio greater than 1:1.
The company's outlook statements are based on current expectations.
The following statements are forward-looking, and actual results could
differ materially. The company's current outlook is based on the following
projections for its flagship products.
In the fourth quarter, the company again expects to sell out its
production of AMD Athlon processors. The company expects that sales of AMD
Athlon processors, AMD Duron processors, and PC processors in the aggregate
will set new records, individually and collectively, in both units and
dollars. For the year, the company expects that total sales of PC processors
will easily exceed earlier projections of 25 million units, with the final
tally projected to be approximately 28 million units, compared to last
year's 18.8 million units. The company projects that sales of AMD PC
processors will be between 8 and 9 million units in the fourth quarter based
on a total market projected to be between 43 and 45 million units.
The company's production capacity ramp will be the limiting factor
in growth in sales of AMD flash memory products in the fourth quarter. The
company projects that demand for AMD flash memory products will continue to
exceed supply for the foreseeable future.
The company projects that total sales will grow in the
high-single-digit range sequentially, resulting in annual sales of
approximately $4.8 billion, compared to approximately $2.9 billion in 1999.
AMD will hold a teleconference for the financial community at 2:30
PM Pacific Daylight Time today to discuss third-quarter financial results.
AMD will provide a real-time audio broadcast of the teleconference on the
Investor Relations page of its web site at http://www.amd.com or
http://www.streetfusion.com. The webcast will be available for two weeks
after the teleconference.
AMD will also provide a telephone recording of the teleconference,
which will be available at approximately 4:30 PM PDT today. Interested
persons may listen to the playback of the teleconference by calling the
following toll-free number: 1-800-633-8284 and entering the code number
This release contains forward-looking statements, which are made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform Act
of 1995. Investors are cautioned that forward-looking statements in this
release involve risks and uncertainty that could cause actual results to
differ materially from current expectations. There can be no assurance that
demand for the company's products will continue at current or greater
levels, or that the company will continue to grow revenues, operating
profit, or earnings.
There are also risks that the company will not be able to produce the AMD
Athlon and AMD Duron processors in the volume, speed mix or with the feature
set necessary to meet customer requirements and the company's plans and
goals; that Intel Corporation pricing, marketing programs, new product
introductions or other activities targeting the company's processors
business will prevent attainment of the company's current processor sales
plans; that third parties may not provide timely or adequate infrastructure
solutions to support the AMD Athlon and AMD Duron processors; that the
company will not be able to grow demand for its PC processors sufficiently
to utilize fully its processor production capacity; and that uncertain
global economic conditions or Middle East tensions will cause lower than
expected demand for the company's products. We urge investors to review in
detail the risks and uncertainties in the company's Securities and Exchange
Commission filings, including but not limited to the report on Form 10-K for
the year ended December 26, 1999.
AMD is a global supplier of integrated circuits for the personal and
networked computer and communications markets with manufacturing facilities
in the United States, Europe, Japan, and Asia. AMD produces microprocessors,
flash memory devices, and support circuitry for communications and
networking applications. Founded in 1969 and based in Sunnyvale, California,
AMD had revenues of $2.9 billion in 1999. (NYSE: AMD).
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