AMD 2014 Annual Report Download - page 33

new product introductions, price erosion and declines in general economic conditions. We have incurred
substantial losses in recent downturns, due to:
• substantial declines in average selling prices;
• the cyclical nature of supply/demand imbalances in the semiconductor industry;
• a decline in demand for end-user products (such as PCs) that incorporate our products; and
• excess inventory levels.
Industry-wide fluctuations in the computer marketplace have materially adversely affected us in the past and
may materially adversely affect us in the future. Currently, a large portion of our business is focused on the
consumer PC portions of the market, which has experienced a decline driven by the adoption of smaller form
factors and increased competition.
Global economic uncertainty and weakness have also impacted the semiconductor market as consumers and
businesses have deferred purchases, which negatively impacted demand for our products. Our financial
performance has been, and may in the future be, negatively affected by these downturns.
The growth of our business is also dependent on continued demand for our products from high-growth
adjacent emerging global markets. Our ability to be successful in such markets depends in part on our ability to
establish adequate local infrastructure, as well as our ability to cultivate and maintain local relationships in these
markets. If demand from these markets is below our expectations, sales of our products may decrease, which
would have a material adverse effect on us.
Our business is dependent upon the proper functioning of our internal business processes and information
systems and modification or interruption of such systems may disrupt our business, processes and internal
controls.
We rely upon a number of internal business processes and information systems to support key business
functions, and the efficient operation of these processes and systems is critical to our business. Our business
processes and information systems need to be sufficiently scalable to support the growth of our business and may
require modifications or upgrades that expose us to a number of operational risks. As such, our information
systems will continually evolve and adapt in order to meet our business needs. These changes may be costly and
disruptive to our operations and could impose substantial demands on management time.
These changes may also require changes in our information systems, modification of internal control
procedures and significant training of employees and third-party resources. We continuously work on simplifying
our information systems and applications through consolidation and standardization efforts. There can be no
assurance that our business and operations will not experience any disruption in connection with this transition.
Our information technology systems, and those of third-party information technology providers or business
partners, may also be vulnerable to damage or disruption caused by circumstances beyond our control including
catastrophic events, power anomalies or outages, natural disasters, viruses or malware, cyber-attacks, data
breaches and computer system or network failures, exposing us to significant cost, reputational harm and
disruption or damage to our business.
In addition, as our IT environment continues to evolve, we are embracing new ways of communicating and
sharing data internally and externally with customers and partners using methods such as mobility and the cloud
that can promote business efficiency. However, these practices can also result in a more distributed IT
environment, making it more difficult for us to maintain visibility and control over internal and external users,
and meet scalability and administrative requirements. If our security controls cannot keep pace with the speed of
these changes, or if we are not able to meet regulatory and compliance requirements, our business would be
materially adversely affected.
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