AMD 2000 Annual Report Download - page 370

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
On June 15, 1999, we sold Vantis to Lattice Semiconductor Corporation (Lattice)
for approximately $500 million in cash. As part of the transaction, we entered
into service contracts with Vantis to provide, among other things, wafer
fabrication and assembly, test, mark and pack services to Vantis. We receive
fees from Lattice for these services.
The following is a summary of net sales by segment for 2000, 1999 and 1998:
2000 1999 1998
(Millions) ----------------------------------
Core Products segment:
PC Processors $ 2,337 $ 1,387 $ 1,258
Memory Products 1,567 773 561
Other IC Products 457 400 362
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4,361 2,560 2,181
Voice Communications segment 140 168 156
Vantis segment - 87 205
Foundry Services segment 143 43 -
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Total $ 4,644 $ 2,858 $ 2,542
========= ========== ========
Net Sales Comparison of Years Ended December 31, 2000 and December 26, 1999
Total net sales increased by $1,786 million in 2000, or 63 percent, to $4,644
million from $2,858 million in 1999.
PC processors net sales of $2,337 million increased by 68 percent in 2000
compared to 1999. This increase was primarily due to a strong increase in net
sales of our seventh-generation microprocessors, the AMD Athlon and AMD Duron
microprocessors. The AMD Duron microprocessor, a derivative of the AMD Athlon
microprocessor designed to provide a solution for value conscious PC buyers,
became available in June 2000. The strong increase in unit sales of our
seventh-generation microprocessors more than offset the decline in average
selling prices. The increase was partially offset by a decrease in net sales of
the AMD-K6 family microprocessors as a result of market shift toward our
seventh-generation microprocessors. Overall PC processors sales growth in 2001
depends on a continuing successful production ramp in Dresden Fab 30,
availability of chipsets and motherboards from third-party suppliers and
increasing market acceptance of our seventh-generation microprocessors, as to
which we cannot give any assurance.
Memory products net sales of $1,567 million increased by 103 percent in 2000
compared to 1999 primarily due to growth in sales volume, higher average selling
prices, and a rich product mix of Flash memory devices, which was slightly
offset by a decline in net sales of EPROMs. We plan to continue to expand
manufacturing capacity through FASL to achieve further growth in net sales of
Flash memory devices in 2001, as to which we cannot give any assurance.
Other IC products net sales of $457 million increased by 14 percent in 2000
compared to 1999. The increase was primarily due to increased net sales from our
chipset and home networking products.
-3-
Source: ADVANCED MICRO DEVIC, 10-K405, March 20, 2001