AMD 2001 Annual Report Download - page 221

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
these materials, we might have to reduce our manufacturing operations. Such a
reduction could have a material adverse effect on us.
We Are Subject to Political and Economic Risks Associated with Our Operations in
Foreign Countries. Nearly all product assembly and final testing of our products
are performed at our manufacturing facilities in Penang, Malaysia; Bangkok,
Thailand; Suzhou, China; Japan; and Singapore; or by subcontractors in the
United States and Asia. We also depend on foreign foundry suppliers and joint
ventures for the manufacture of a portion of our finished silicon wafers and
have international sales operations. The political and economic risks associated
with our operations in foreign countries include:
o expropriation;
o changes in a specific country's or region's political or economic
conditions;
o trade protection measures and import or export licensing requirements;
o difficulty in protecting our intellectual property;
o changes in foreign currency exchange rates and currency controls;
o changes in freight and interest rates;
o disruption in air transportation between the United States and our overseas
facilities; and
o loss or modification of exemptions for taxes and tariffs;
any of which may have a material adverse effect on us.
We Rely on Our Ability to Attract and Retain Key Personnel. Our future success
depends upon the continued service of numerous key engineering, manufacturing,
marketing, sales and executive personnel. If we are not able to continue to
attract, retain and motivate qualified personnel necessary for our business, the
progress of our product development programs could be hindered, and we could be
otherwise adversely affected.
Our Operating Results are Subject to Substantial Quarterly and Annual
Fluctuations. Our operating results are subject to substantial quarterly and
annual fluctuations due to a variety of factors, including decreases in average
selling prices of our products, general worldwide economic conditions, the gain
or loss of significant customers, market acceptance of our products and new
product introductions by us or our competitors. In addition, changes in the mix
of products produced and sold in the mix of sales by distribution channels, in
the availability and cost of products from our suppliers or in production
capacity and manufacturing yields can contribute to periodic fluctuations in
operating results.
Our operating results also tend to vary seasonally. Our revenues are generally
lower in the first, second and third quarters of each year than in the fourth
quarter. This seasonal pattern is largely a result of decreased demand in Europe
during the summer months and higher demand in the retail sector of the PC
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Source: ADVANCED MICRO DEVIC, 10-K, March 07, 2002