AMD 2007 Annual Report Download - page 67

Table of Contents
partially offset by $18 million lower corporate bonus expense, increases of $20 million and eight million, respectively, due to the consolidation of marketing,
general and administrative expenses attributable to our Graphics and Consumer Electronics segments from October 25, 2006 to December 31, 2006, and a $44
million increase in stock-based compensation and profit sharing expenses. The increase in marketing, general and administrative expenses were partially offset
by the absence of marketing, general and administrative expenses attributable to Spansion’s operations because we did not consolidate Spansion’s results of
operations into ours in 2006. In 2005, marketing, general and administrative expenses attributable to our Memory Products segment were $208 million.
In-process research and development, amortization of acquired intangible assets and integration charges, and impairment to goodwill and acquired
intangible assets.
Amortization of acquired intangible assets and integration charges in 2007 included amortization of $271 million and integration charges of $28 million.
During 2007, we recorded an impairment charge of $1.6 billion associated with our goodwill and acquired intangible assets. See Part II, Item 7 “MD&A—“ATI
Acquisition.”
In-process research and development charges of $416 million in 2006 related to projects acquired in connection with the acquisition of ATI. Amortization
of acquired intangible assets and integration charges in 2006 included amortization of $47 million and integration charges of $32 million. See Part II, Item 7
“MD&A—“ATI Acquisition.”
Effects of 2002 Restructuring Plan
In December 2002, we began implementing a restructuring plan (the 2002 Restructuring Plan) to further align our cost structure to industry conditions
resulting from weak customer demand and industry-wide excess inventory.
The 2002 Restructuring Plan resulted in the consolidation of facilities, primarily at our Sunnyvale, California site and at sales offices worldwide. We
vacated and are attempting to sublease certain facilities that we currently occupy under long-term operating leases through 2011. At December 29, 2007 and
December 31, 2006, we had approximately $50 million and $67 million of related vacated facility lease accruals recorded which will continue to be paid through
2011.
Interest Income
Interest income of $73 million in 2007 decreased $43 million from $116 million in 2006, primarily due to lower average cash and marketable securities
balances in 2007 compared to 2006, partially offset by a 7 percent increase in weighted-average interest rates in 2007 compared to 2006.
Interest income of $116 million in 2006 increased from $37 million in 2005, primarily due to an increase in average cash and marketable securities during
2006 compared to 2005 and a 54 percent increase in weighted-average interest rates.
Interest Expense
2007 2006 2005
(In millions)
Total interest charges $ 390 $ 136 $ 140
Less: interest capitalized (23) (10) (35)
Interest expense $ 367 $ 126 $ 105
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Source: ADVANCED MICRO DEVIC, 10-K, February 26, 2008