AMD 2013 Annual Report Download - page 17

Download and view the complete annual report

Please find page 17 of the 2013 AMD annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 132

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132

We generally warrant that our products sold to our customers will conform to our approved specifications
and be free from defects in material and workmanship under normal use and service for one year. Subject to
certain exceptions, we also offer a three-year limited warranty to end users for only those CPU and AMD A-
Series APU products that are commonly referred to as “processors in a box” and for PC workstation products.
We have also offered extended limited warranties to certain customers of “tray” microprocessor products and/or
workstation graphics products who have written agreements with us and target their computer systems at the
commercial and/or embedded markets.
We market and sell our products under the AMD trademark. Our desktop PC product brands for
microprocessors are AMD A-Series, AMD E-Series, AMD FX, AMD Athlon and AMD Sempron. Our notebook
and tablet brands for microprocessors are AMD A-Series A, AMD E-Series, AMD C-Series, AMD Z-Series,
AMD Phenom, AMD Athlon, AMD Turion and AMD Sempron. Our server brand for microprocessors is AMD
Opteron. We sell dense server systems products under the SeaMicro brand, including the SM15000 series and
Freedom Fabric Storage series for storage systems. We also sell low-power versions of our AMD Opteron, AMD
Athlon and AMD Sempron, as well as AMD Geode, AMD R-Series and G-Series processors as embedded
processor solutions. Our product brand for the consumer graphics market is AMD Radeon. Our product brand for
professional graphics products is AMD FirePro. We also market and sell our chipsets under the AMD trademark.
We market our products through our direct marketing and co-marketing programs. In addition, we have
cooperative advertising and marketing programs with customers and third parties, including market development
programs, pursuant to which we may provide product information, training, marketing materials and funds.
Under our co-marketing development programs, eligible customers can use market development funds as partial
reimbursement for advertisements and marketing programs related to our products and third-party systems
integrating our products, subject to meeting defined criteria.
Customers
Our microprocessor customers consist primarily of original equipment manufacturers, or OEMs, original
design manufacturers, or ODMs, system builders and independent distributors in both domestic and international
markets. ODMs provide design and/or manufacturing services to branded and unbranded private label resellers,
OEMs and system builders. Our graphics products customers include the foregoing as well as add-in-board
manufacturers, or AIBs.
Customers of our chipset products consist primarily of PC and server OEMs, often through ODMs or other
contract manufacturers, who build the OEM motherboards, as well as desktop and server motherboard
manufacturers who incorporate chipsets into their channel motherboards.
Our sales and marketing teams work closely with our customers to define product features, performance and
timing of new products so that the products we are developing meet our customers’ needs. We also employ
application engineers to assist our customers in designing, testing and qualifying system designs that incorporate
our products in order to assist in optimizing product compatibility. We believe that our commitment to customer
service and design support improves our customers’ time-to-market and fosters relationships that encourage
customers to use the next generation of our products.
We work closely with our customers to create differentiated products that leverage our CPU, GPU and APU
technology. Customers pay us non-recurring engineering fees for design and development services and a
purchase price for our semi-custom products.
Collectively, our top five customers accounted for approximately 54% of our net revenue during the year
ended 2013. In 2013, Hewlett-Packard Company, Microsoft Corporation and Sony Corporation each accounted
for more than 10% of our consolidated net revenues. Sales to Hewlett-Packard consisted primarily of products
from our Computing Solutions segment. Sales to Microsoft and Sony consisted primarily of products from our
9