AMD 2006 Annual Report Download - page 39

Table of Contents
• changes in tax laws, trade protection measures and import or export licensing requirements;
• difficulties in protecting our intellectual property;
• difficulties in achieving headcount reductions;
• changes in foreign currency exchange rates;
• restrictions on transfers of funds and other assets of our subsidiaries between jurisdictions;
• changes in freight and interest rates;
• disruption in air transportation between the United States and our overseas facilities; and
• loss or modification of exemptions for taxes and tariffs.
Any conflict or uncertainty in the countries in which we operate, including public health or safety, natural disasters or general economic factors, could
have a material adverse effect on our business. Any of the above risks, should they occur, could result in an increase in the cost of components, production
delays, general business interruptions, delays from difficulties in obtaining export licenses for certain technology, tariffs and other barriers and restrictions,
potentially longer payment cycles, potentially increased taxes, restrictions on the repatriation of funds and the burdens of complying with a variety of foreign
laws, any of which could ultimately have a material adverse effect on us.
Worldwide economic and political conditions may adversely affect demand for our products.
Worldwide economic conditions may adversely affect demand for our products. For example, China’s economy has been growing at a fast pace over the
past several years, and the Chinese government introduced various measures to slow down the pace of economic growth. A decline in economic conditions in
China could lead to declining worldwide economic conditions. If economic conditions decline, whether in China or worldwide, we could be materially adversely
affected.
The occurrence and threat of terrorist attacks and the consequences of sustained military action in the Middle East have in the past, and may in the future,
adversely affect demand for our products. Terrorist attacks may negatively affect our operations, directly or indirectly, and such attacks or related armed conflicts
may directly impact our physical facilities or those of our suppliers or customers. Furthermore, these attacks may make travel and the transportation of our
products more difficult and more expensive, which could materially adversely affect us.
The United States has been and may continue to be involved in armed conflicts that could have a further impact on our sales, and our supply chain.
Political and economic instability in some regions of the world may also result and could negatively impact our business. The consequences of armed conflicts
are unpredictable, and we may not be able to foresee events that could have a material adverse effect on us.
More generally, any of these events could cause consumer confidence and spending to decrease or result in increased volatility in the United States
economy and worldwide financial markets. Any of these occurrences could have a material adverse effect on us and also may result in volatility of the market
price for our securities.
Unfavorable currency exchange rate fluctuations could adversely affect us.
We have costs, assets and liabilities that are denominated in foreign currencies, primarily the euro and yen, and as a result of our recent acquisition of ATI,
the Canadian dollar. As a consequence, movements in exchange rates could cause our Canadian dollar and euro-denominated expenses and yen-based raw
material purchases to increase as a percentage of revenue, affecting our profitability and cash flows. Whenever we believe appropriate, we hedge a portion of our
foreign currency exposure to protect against fluctuations in currency exchange rates. We determine our total foreign currency exposure using projections of
expenditures for items such as payroll,
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Source: ADVANCED MICRO DEVIC, 10-K, March 01, 2007