AMD 2011 Annual Report Download - page 59

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Solutions segment and a $22 million increase in research and development expenses attributable to our Graphics
segment, partially offset by a $38 million decrease in research and development expenses attributable to our All
Other category. The increase in research and development expenses attributable to our Computing Solutions
segment was primarily due to a $91 million increase in product engineering and design costs for our future
products, a $68 million increase in employee compensation and benefit expense and a $64 million increase in
manufacturing process technology expenses related to GF for our future products. The increase in research and
development expenses attributable to our Graphics segment was primarily due to a $33 million increase in
employee compensation and benefit expense, partially offset by a $13 million decrease in product engineering
and design costs due to lower material costs used in 2010. The decrease in research and development expenses
attributable to our All Other category was primarily due to lower research and development expenses related to
handheld products because we no longer develop these products.
Marketing, General and Administrative Expenses
Marketing, general and administrative expenses of $992 million in 2011, increased by $58 million, or 6%,
compared to $934 million in 2010. The increase was primarily due to a $42 million increase in marketing,
general and administrative expenses attributable to our Computing Solutions segment and a $20 million increase
in marketing, general and administrative expenses attributable to our Graphics segment. The increase in
marketing, general and administrative expenses attributable to our Computing Solutions segment was primarily
due to a $41 million increase in sales and marketing activities resulting from an increase in regional marketing
programs and labor expenses and a $14 million increase in general and administrative expenses, partially offset
by a $12 million decrease in other employee compensation and benefit expense. The increase in marketing,
general and administrative expenses in our Graphics segment was primarily due to a $22 million increase in sales
and marketing activities resulting from an increase in regional marketing programs and labor expenses.
Marketing, general and administrative expenses of $934 million in 2010, decreased by $60 million, or 6%,
compared to $994 million in 2009. Marketing, general and administrative expenses in 2009 included $116
million attributable to the Foundry segment. Without taking into account the marketing, general and
administrative expenses attributable to the Foundry segment, which are not indicative of our ongoing
performance, marketing, general and administrative expenses would have increased by $56 million. This increase
was due to a $61 million increase in marketing, general and administrative expenses attributable to our
Computing Solutions segment and a $15 million increase in marketing, general and administrative expenses
attributable to our Graphics segment, partially offset by a $21 million decrease in marketing, general and
administrative expenses attributable to our All Other category. The increase in marketing, general and
administrative expenses in our Computing Solutions segment was primarily due to a $101 million increase in
sales and marketing activities, a $26 million increase in employee compensation and benefit expenses, a $15
million increase in labor expenses and a $7 million increase in other general and administrative expenses. These
increases were partially offset by an $88 million decrease in legal expenses following our settlement with Intel in
2009. The increase in marketing, general and administrative expenses attributable to our Graphics segment was
primarily due to a $15 million increase in employee benefit and compensation expenses and other general and
administrative expenses. The decrease in marketing, general and administrative expenses attributable to the All
Other category was mainly due to the absence of $21 million of expenses incurred in connection with the
formation of GF in the first quarter of 2009.
Legal Settlements
Samsung Settlement
In the fourth quarter of 2010, we entered into a Patent License and Settlement Agreement with Samsung to
end all outstanding legal disputes related to pending patent litigation between us and Samsung. Pursuant to this
agreement, all claims between the parties were dismissed with prejudice and Samsung agreed to pay us $283
million less any withholding taxes. We received the first payment of $119 million (which represents $143 million
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