AMD 2013 Annual Report Download - page 61

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As of December 28, 2013, substantially all of our U.S. and foreign deferred tax assets, net of deferred tax
liabilities, continued to be subject to a valuation allowance. The realization of these assets is dependent on
substantial future taxable income which, at December 28, 2013, in management’s estimate, is not more likely
than not to be achieved.
On January 2, 2013 the American Taxpayer Relief Act of 2012 (the Act) was passed into law. The Act
included a retroactive extension of the U.S. research credit for 2012. Since the effects of tax law changes are
recognized in the first period which includes the date of enactment, the Act had no impact on our 2012 tax
provision. The impact on our 2013 tax provision was immaterial due to the effects of the valuation allowance.
Stock-Based Compensation Expense
Stock-based compensation expense related to employee stock options, restricted stock and restricted stock
units for the years ended December 28, 2013, December 29, 2012 and December 31, 2011 was allocated in our
consolidated statements of operations as follows:
2013 2012 2011
(In millions)
Cost of sales ................................................................. $ 5 $ 8 $ 6
Research and development ...................................................... 48 52 46
Marketing, general and administrative ............................................ 38 37 38
Total stock-based compensation expense, net of tax of $0 ............................. $91 $97 $90
During 2013, 2012 and 2011, we did not realize any excess tax benefits related to stock-based compensation
and therefore we did not record any effects relating to financing cash flows.
Stock-based compensation expense of $91 million in 2013 decreased by $6 million as compared to $97
million in 2012. The decrease was primarily due to a lower weighted average grant date fair value and lower
stock compensation expense as a result of our 2012 restructuring plan, partially offset by the additional expense
related to stock options and restricted stock granted in connection with our SeaMicro acquisition.
Stock-based compensation expenses of $97 million in 2012 increased $7 million compared to $90 million in
2011. The increase was primarily due to the additional expense related to the equity grants made in connection
with our SeaMicro acquisition and an increase in the number of employee stock options and restricted stock units
that we granted, partially offset by the absence of a charge related to the acceleration of vesting of all unvested
equity incentive awards held by our former Chief Executive Officer in the first quarter of 2011 as a result of his
resignation from AMD, effective January 10, 2011, and a lower weighted-average estimated grant date fair value
in 2012 as compared to 2011.
As of December 28, 2013, we had $26 million of total unrecognized compensation expense, net of estimated
forfeitures, related to stock options that will be recognized over a weighted-average period of 1.90 years. Also, as
of December 28, 2013, we had $112 million of total unrecognized compensation expense, net of estimated
forfeitures, related to restricted stock and restricted stock units that will be recognized over a weighted-average
period of 2.03 years.
International Sales
International sales as a percentage of net revenue were 85% in 2013, 92% in 2012 and 93% in 2011. The
decrease in international sales as a percentage of net revenue in 2013 compared 2012 and 2011 was primarily
driven by an increase in net revenue from domestic sales of our semi-custom SOC products. We expect that
international sales will continue to be a significant portion of total sales in the foreseeable future. Substantially
all of our sales transactions were denominated in U.S. dollars.
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