AMD 2004 Annual Report Download - page 109

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November 2002, interest on the July 2003 Spansion Term Loan and interest on other Spansion LLC’s long-term debt and capital lease obligations. In 2002,
interest expense consisted primarily of interest incurred under the Dresden Loan Agreements and interest on the Company’s 4.75% Debentures issued in January
2002. The Company also capitalized interest during 2004 of $9 million in connection with its Fab 36 construction activities in Dresden, Germany.
NOTE 9: Segment Reporting
Management reviews and assesses operating performance using segment revenues and operating income before interest, taxes and minority interest. These
performance measures include the allocation of expenses to the operating segments based on management judgment. Prior to the third quarter of 2003, the
Company had two reportable segments, the Core Products and Foundry Services segments. Primarily as a result of the formation of Spansion LLC, during the
third quarter of 2003, the Company re-evaluated its reportable segments under SFAS 131.
The Company changed its reportable segments to: the Computation Products segment, which includes microprocessor products for desktop and mobile
PCs, servers and workstations and chipset products, and the Memory Products segment, which includes Flash memory products. In addition, in the fourth quarter
of 2004, the Company began presenting its Personal Connectivity Solutions operating segment as a separate reportable segment because the operating loss from
this operating segment exceeded 10 percent of the combined profit of all its operating segments, and therefore this operating segment became a reportable
segment under the requirements of Statement of Financial Standards 131, “Segment Reporting.” Previously, the Company included the Personal Connectivity
Solutions operating segment in its All Other category. The Personal Connectivity Solutions segment includes primarily low power, high performance x86 and
MIPS architecture-based embedded microprocessors. In addition to these three reportable segments, the Company also has the All Other category, which is not a
reportable segment and includes certain operating expenses and credits that are not allocated to the operating segments. All other revenues in 2003 and 2002 were
derived from foundry services which were discontinued in 2002.
Prior period segment information has been reclassified to conform to the current period presentation. However, because Spansion LLC did not exist prior
to June 30, 2003, the Company’s results of operations for prior periods did not include the consolidation of Spansion LLC’s operations. Accordingly, the segment
operating information for the Memory Products segment for the year ended December 26, 2004 is not comparable to the reclassified segment information for the
prior periods presented.
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Source: ADVANCED MICRO DEVIC, 10-K, March 01, 2005