AMD 1995 Annual Report Download - page 11

Computation Products
X86 Microprocessors. A microprocessor is the central processing unit (CPU)
of a computer. A microprocessor processes system data and controls input/output,
peripheral and memory devices. A microprocessor may also be used in connection
with other processors such as microcontrollers, which are embedded
microprocessors contained in peripherals or other coprocessors which perform
certain functions such as arithmetic calculations. The x86 architecture,
originally developed by Intel Corporation (Intel), has been the leading
architecture for personal computer microprocessors. AMD's x86 microprocessor
strategy has been to serve as an alternative source for x86 microprocessors,
introducing products with higher performance at comparable prices. Since 1993
the Corporation has been licensed by Microsoft, the personal computer industry's
leading supplier of operation systems software, to use the Microsoft(R)
Windows(R) -compatible logo on AMD's microprocessor packaging and advertising to
indicate that the Corporation's product is compatible with such software. The
Corporation believes that this approach is consistent with what it perceives to
be the computer industry's shift from an emphasis on hardware compatibility to
software compatibility.
In 1995, Am486(R) microprocessor sales decreased slightly primarily due to
average selling price declines, partially offset by increases in unit sales.
Am486 microprocessor products contributed a significant portion of the
Corporation's revenues and profits in 1994 and 1995. Price declines are
anticipated to continue in 1996 while unit shipments may be flat to down
depending on market demand. The Corporation, therefore, expects Am486
microprocessor revenues and profits in 1996 to be below those of 1995 as the
product life cycle of the fourth-generation x86 products draws to a close.
K86(tm) Microprocessors. The Corporation expects that it will offer in 1996
its next generation of microprocessor products known as the K86 microprocessors,
based on superscalar RISC-type architecture. The K86 products are designed to be
compatible with operating system
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Source: ADVANCED MICRO DEVIC, 10-K405, March 21, 1996