AMD 2011 Annual Report Download - page 2

To Our Stockholders:
AMD enters 2012 firmly focused on becoming a solid execution engine, while positioning
ourselves to take advantage of growth opportunities driven by a fundamental shift in the
computing ecosystem.
We refreshed our product portfolio in 2011 to better align with the needs of our customers and
consumers. We enabled a new era in vivid computing, with the well-received launch of the
world’s first Accelerated Processing Units (APUs) and continued to offer the best HD
entertainment experience on the planet with our AMD Radeon™ graphics solutions. In
addition, we were pleased to exit the year with an improving server business with the
introduction of a new generation of AMD Opteron™ processors.
2011 financial performance
We executed well to our financial goals in 2011, and renewed our operational efficiency
efforts implementing several initiatives to help reduce costs, streamline processes and speed
time to market. While revenue was largely flat year-over-year, solid improvements in
non-GAAP adjusted free cash flow allowed us to strategically reduce our debt by more than
$200 million in principal value and strengthen our balance sheet. Further, we delivered
non-GAAP net income in every quarter. We believe that consistent operational and financial performance will strengthen our ability to
strategically invest in the areas of our business that will provide sustainable returns over the long-term.
Improving momentum signals promising potential
We shipped more than 30 million APUs in 2011, with 11 of the world’s top 12 global computer companies offering APU-based products,
including Acer, Asus, Dell, HP, Lenovo, Samsung, Sony and Toshiba. We also shipped more than 100 million DirectX®11-capable
graphics engines – up from 2010 and underscoring our leadership in the graphics market.
We achieved record client microprocessor and mobile microprocessor annual revenue and overall unit shipments. Those milestones
included the strong success of our low-power platform, codenamed “Brazos,” which drove a 25 percent increase in mobile processor
shipments and global notebook share gains in 2011. We are proud that “Brazos” is the most successful and fastest-ramping platform in
AMD’s history.
We also posted an all-time high in mobile and professional graphics revenue for 2011. We introduced the first member of our next-
generation graphics family to industry acclaim at the end of the fourth quarter, ensuring that we exited the year the same way we entered
it – with the world’s fastest graphics processor – the AMD Radeon™ HD 7970. Going forward, we believe AMD’s graphics technology
provides us with superior video, multimedia and graphics capabilities that form the core of our competitive advantage.
In our server business we regained business momentum with the introduction of our new central processing units (CPU) – based on the
CPU core codenamed “Bulldozer” – the AMD Opteron™ 6200 and 4200 processors. The new “Bulldozer”-based processors, launched in
November 2011, ramped quickly to meet customer demand and accounted for more than one third of our total server unit shipments in
the fourth quarter. Continued adoption in the high performance computing market was bolstered by the introduction of several HP and
Dell servers powered by the AMD Opteron 6200 processor. In the supercomputing space, AMD now powers 64 out of 100 of the world’s
fastest supercomputers, including the fastest supercomputers in the United States, Germany, Switzerland and the United Kingdom.
Writing a new chapter for AMD
Over the past year, we took important steps to begin writing a new chapter for AMD. Our leadership team has been bolstered with the
additions of Mark Papermaster as Senior Vice President and Chief Technology Officer and Lisa Su as Senior Vice President and
General Manager, Global Business Units. This management team is unwavering in its commitment to make sustainable, dependable
execution a hallmark of AMD.
We strengthened our foundation, our culture by introducing The AMD Way, which is grounded in Ownership and Commitment, Customer
Focus and Innovation Leadership. This is how we’ll align the thousands of AMDers across the planet around a shared set of beliefs and
actions.
Over the next 12 months we will focus on enabling two lifts of value creation. The first is through solid, consistent execution – delivering
on our commitments each and every day. At the same time we will lay the groundwork for our second lift, by continuing to reposition our
company, building the right capabilities and increasing our focus on emerging growth areas around low power, the cloud and
convergence. We will marry market needs with innovative leadership technologies. We will work to build flexibility and agility into our
products to help our customers win. And we will bring disruptive innovation into key markets to create stockholder value.
I believe that the opportunity for AMD has never been greater. We see our opportunities and also recognize challenges we must
overcome, and the work that must be done. This is the first of many chapters we will write, and I look forward to starting this new chapter
for AMD and for you, our stockholders.
Sincerely,
Rory P. Read
President and Chief Executive Officer
AMD
March 2012
CAUTIONARY STATEMENT
The forward-looking statements contained herein are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act
of 1995. Investors are cautioned that forward-looking statements contained herein involve risks and uncertainties that could cause actual results
to differ materially from current expectations. We urge investors to review in detail the risks and uncertainties in our Securities and Exchange
Commission filings, including but not limited to the Annual Report on Form 10-K for the year ended December 31, 2011.