AMD 2010 Annual Report Download - page 69

Operating Activities
Net cash used in operating activities was $412 million in 2010. Net income of $471 million was adjusted for
non-cash charges consisting primarily of a $462 million loss from the application of the equity method of
accounting for our investment in GF, $383 million of depreciation and amortization expense, $87 million of
stock-based compensation expense, $30 million of interest expense primarily related to our 6.00% Notes and our
8.125% Notes and a $24 million net loss primarily related to our repurchase of an aggregate of $1,016 million
principal amount of our 6.00% Notes for $1,011 million in cash. These charges were partially offset by a
one-time, non-cash gain of $325 million related to the deconsolidation of GF, amortization of foreign grants of
$16 million and a net gain of $17 million from the sale of marketable securities. The net changes in operating
assets at December 25, 2010 compared to December 26, 2009 included an increase in accounts receivable of
$1,138 million, which included the non-cash impact of our financing arrangements with the IBM Parties. During
2010, the IBM Parties collected approximately $915 million from our distributor customers pursuant to these
arrangements. Without considering the collection by the IBM Parties of the accounts receivables that we sold to
them, our accounts receivable increased $223 million. This increase was primarily due to the introduction and
sale of new products towards the end of 2010 and the timing of the related collections. Excluding the effects of
the deconsolidation of GF, there was also a decrease in accounts payable, accrued liabilities and other of $184
million, primarily due to the timing of payments. Accounts payable to GF increased by $55 million due to the
timing of payments during 2010.
Net cash provided by operating activities was $473 million in 2009, which included $1.2 billion from the
settlement of our litigation with Intel. Net income of $293 million was adjusted for non-cash charges consisting
primarily of $1.1 billion of depreciation and amortization expense, $121 million of interest expense primarily
related to GF’s Class A Notes and Class B Notes and our 6.00% Notes, $75 million of stock-based compensation
expense, a $28 million net loss from the sale and disposal of property, plant and equipment and an $11 million
net loss primarily related to the redemption of all of our 7.75% Notes. These charges were offset by a net gain of
$180 million related to our repurchase of an aggregate of $344 million principal amount of our 6.00% Notes for
$161 million in cash and $1,015 million principal amount of our 5.75% Notes for $1,002 million in cash,
amortization of foreign grants and allowances of $110 million and a gain of $28 million from the sale of certain
Handheld assets. The net changes in operating assets at December 26, 2009 compared to December 27, 2008
included an increase in accounts receivable of $960 million. During 2009, the IBM Parties collected
approximately $535 million from our distributor customers pursuant to the financial arrangement described
above. Without considering the collections by the IBM Parties of the accounts receivables that we sold to them,
the increase in accounts receivable was $425 million. This increase was primarily due to timing of sales and
collections during 2009. There was also a decrease in accounts payable and accrued liabilities of $105 million,
primarily due to lower purchases reflecting the effect of our cost cutting efforts and timing of payments.
Net cash used in operating activities was $692 million in 2008. Net loss of $3.1 billion was adjusted for
non-cash charges consisting primarily of $1.7 billion of goodwill and acquisition-related intangible impairment
charges attributable to discontinued operations, $1.2 billion of depreciation and amortization expense, $83
million of stock-based compensation expense, $77 million of other than temporary impairment on our marketable
securities, $29 million net loss from the sale and disposal of property, plant and equipment and $29 million of
interest expense primarily related to our 6.00% Notes. These charges were offset by a $193 million net gain on
the sale of certain 200-millimeter wafer fabrication equipment, the amortization of foreign grants and allowances
of $107 million and a net gain of $34 million on our repurchase of a portion of our 6.00% Notes. The net changes
in our operating assets at December 27, 2008 compared to December 29, 2007 included a decrease of
$722 million in accounts payable and accrued liabilities primarily reflecting the effects of our cost cutting efforts
and a decrease of $101 million in accounts receivable. During 2008, the IBM Parties collected approximately
$221 million from our distributor customers pursuant to the financing arrangements described above. Without
considering the collections by the IBM Parties of the accounts receivables that we sold to them, the decrease in
accounts receivable was $322 million primarily due to a decrease in sales and improved cash collection efforts in
2008. There was also a decrease of $64 million in prepaid and other current assets primarily related to a decrease
in receivables of foreign grants and allowances.
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