AMD 2006 Annual Report Download - page 16

Table of Contents
We generally warrant that microprocessor products sold to our customers will, at the time of shipment, be free from defects in workmanship and materials
and conform to our approved specifications. Subject to certain exceptions, we offer a three-year limited warranty to end users for microprocessor products that
are commonly referred to as “processors in a box,” a one-year limited warranty to direct purchasers for all other microprocessor products that are commonly
referred to as “tray” microprocessor products, and a one-year limited warranty to direct purchasers of embedded processor products. We have offered extended
limited warranties to certain customers of “tray” microprocessor products who have written agreements with us and target their computer systems at the
commercial and/or embedded markets.
We generally warrant that graphics, chipsets, and certain products for consumer electronics devices will be free from defects in material and workmanship
under normal use and service for a period of one year, beginning on the date first sold to an end user but not later than 90 days after shipment of such products to
our customers. We generally warrant that ATI-branded PC workstation products will be free from defects in material and workmanship under normal use and
service for a period of three years, beginning on the date first sold to an end user but not later than 90 days after shipment of such products to our customers.
Generally, our microprocessor and embedded processor customers may cancel orders 30 days prior to shipment without incurring a penalty. Under our standard
terms and conditions, graphics and chipset customers may cancel orders by providing 30 days prior written notice to us without incurring a penalty, while certain
customers of products for consumer electronic devices may cancel orders by providing 90 days prior advance notice to us without incurring a penalty.
We market and sell our microprocessor and embedded processor products under the AMD trademark. Our product brands for microprocessors consist
primarily of AMD Athlon 64, AMD Athlon 64 FX and AMD Sempron processor brands for desktop PCs, the AMD Opteron processor brand for servers and
workstations, the AMD Turion 64 mobile technology and AMD Sempron processor brands for notebook PCs. We also have the AMD LIVE! ™ brand through
which we promote our entertainment platform solutions for desktop and notebook PCs as well as film, broadcast and music professional artists that use AMD64
technology. Our product brands for our embedded processors consist of AMD Geode processors. We also sell low-power versions of our AMD Athlon, AMD
Turion, AMD Sempron and AMD Opteron processors as embedded processor solutions.
With respect to our graphics and chipset products, we intend to continue to market and sell GPUs and graphics chipsets for the Intel platform under the
ATI trademark. We market and sell other chipset products and our products for consumer electronics devices under the AMD trademark.
We market our products through our direct marketing and co-marketing programs. Our direct marketing activities include print and Web-based advertising
as well as consumer and trade events and other industry and consumer communications. We also sponsor teams such as the Discovery Channel Pro Cycling
Team and the Scuderia Ferrari. We work with these groups to determine their technology needs and how our AMD64 technology can help support those needs.
The goal of these sponsorships is to increase awareness of our brand and AMD64 technology.
In addition, we have cooperative advertising and marketing programs with customers or third parties, including market development programs, pursuant to
which we may provide product information, training, marketing materials and funds. Under our marketing development programs, eligible customers can use
market development funds as partial reimbursement for advertisements and marketing programs related to our products, subject to meeting defined criteria.
Customers may qualify for market development funds based on purchases of eligible products.
Customers
Our microprocessor customers consist primarily of OEMs, original design manufacturers, or ODMs, and third-party distributors in both domestic and
international markets. ODMs provide design and/or manufacturing services to branded and unbranded private label resellers.
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Source: ADVANCED MICRO DEVIC, 10-K, March 01, 2007