AMD 2013 Annual Report Download - page 57

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45% in 2011. Gross margin in 2012 was also adversely impacted by the $100 million inventory write-down in the
third quarter of 2012 as a result of lower than anticipated future demand for certain products, mainly first
generation A-Series APU products as well as lower average selling price for microprocessor products.
Expenses
Research and Development Expenses
Research and development expenses of $1.2 billion in 2013 decreased by $153 million, or 11%, compared
to $1.4 billion in 2012. The decrease was primarily due to a $178 million decrease in research and development
expenses attributable to our Computing Solutions segment and a $4 million decrease in stock-based
compensation expense recorded in the All Other category, partially offset by a $29 million increase in research
and development expenses attributable to our Graphics and Visual Solutions segment. Research and development
expenses attributable to our Computing Solutions segment decreased as a result of a $157 million decrease in
product engineering costs and a $41 million decrease in manufacturing process technology expenses, partially
offset by a $20 million increase in other employee compensation and benefit expenses. The increase in research
and development expenses attributable to our Graphics and Visual Solutions segment was primarily due to a $17
million increase in product engineering costs and a $14 million increase in other employee compensation and
benefit expenses.
Research and development expenses of $1.4 billion in 2012, decreased by $99 million, or 7%, compared to
$1.5 billion in 2011. The decrease was due to a $60 million decrease in research and development expenses
attributable to our Graphics and Visual Solutions segment and a $45 million decrease in research and
development expenses attributable to our Computing Solutions segment, partially offset by a $6 million increase
in stock-based compensation expense recorded in the All Other category. Research and development expenses
attributable to our Graphics and Visual Solutions segment decreased as a result of a $36 million decrease in
product engineering costs, a $16 million decrease in other employee compensation and benefit expense and a $9
million decrease in manufacturing process technology expenses. The decrease in research and development
expenses attributable to our Computing Solutions segment was primarily due to a $26 million decrease in other
employee compensation and benefit expense, an $11 million decrease in manufacturing process technology
expenses related to GF for our future products and a $9 million decrease in product engineering costs.
Marketing, General and Administrative Expenses
Marketing, general and administrative expenses of $674 million in 2013 decreased by $149 million, or 18%,
compared to $823 million in 2012. The decrease was primarily due to a $179 million decrease in marketing,
general and administrative expenses attributable to our Computing Solutions segment and a $6 million decrease
in the All Other category due to the absence of SeaMicro acquisition-related costs recorded in 2012, partially
offset by a $36 million increase in marketing, general and administrative expenses attributable to our Graphics
and Visual Solutions segment. Marketing, general and administrative expenses attributable to our Computing
Solutions segment decreased primarily due to a $101 million decrease in sales and marketing activities and an
$82 million decrease in other general and administrative expenses, partially offset by a $5 million increase in
other employee compensation and benefit expense. Marketing, general and administrative expenses attributable
to our Graphics and Visual Solutions segment increased primarily due to a $46 million increase in other general
and administrative expenses and a $4 million increase in other employee compensation and benefit expense,
partially offset by a $12 million decrease in sales and marketing activities.
Marketing, general and administrative expenses of $823 million in 2012 decreased by $169 million, or 17%,
compared to $992 million in 2011, reflecting the effect of the 2011 restructuring plan and our efforts to reduce
operating expenses. The decrease was primarily due to a $136 million decrease in marketing, general and
administrative expenses attributable to our Computing Solutions segment and a $41 million decrease in
marketing, general and administrative expenses attributable to our Graphics and Visual Solutions segment,
49