AMD 2014 Annual Report Download - page 30

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The demand for our products depends in part on the market conditions in the industries into which they are
sold. Fluctuations in demand for our products or a market decline in any of these industries could have a
material adverse effect on our results of operations.
A significant portion of our business is currently dependent upon the market for desktop PCs and notebooks.
Form factors continue to shift from desktop PCs and notebooks to tablets. Historically, a significant portion of
our Computing and Graphics revenue has been related to desktop PCs. Currently, a large portion of our business
is focused on the consumer PC portions of the market, which has experienced a decline driven by the adoption of
smaller form factors and increased competition. Industry-wide fluctuations in the computer marketplace have
materially adversely affected us in the past and may materially adversely affect us in the future. The success of
our semi-custom SoC products is dependent on securing customers for our semi-custom design pipeline and
consumer market conditions, including the success of the Sony PlayStation®4 and Microsoft Xbox One game
console systems worldwide.
Our ability to design and introduce new products in a timely manner is dependent upon third-party intellectual
property.
In the design and development of new products and product enhancements, we rely on third-party
intellectual property such as software development tools and hardware testing tools. Furthermore, certain product
features may rely on intellectual property acquired from third parties. The design requirements necessary to meet
consumer demand for more features and greater functionality from semiconductor products may exceed the
capabilities of the third-party intellectual property or development tools available to us. If the third-party
intellectual property that we use becomes unavailable, is not available in the time frame or price point needed for
our new products or fails to produce designs that meet customer demands, our business could be materially
adversely affected.
We depend on third-party companies for the design, manufacture and supply of motherboards, BIOS software
and other computer platform components to support our business.
We depend on third-party companies for the design, manufacture and supply of motherboards, BIOS
software and other components that our customers utilize to support our microprocessor, GPU and APU
offerings. We also rely on AIBs to support our GPU and APU products. In addition, our microprocessors are not
designed to function with motherboards and chipsets designed to work with Intel microprocessors. If the
designers, manufacturers, AIBs and suppliers of motherboards and other components decrease their support for
our product offerings, our business could be materially adversely affected.
If we lose Microsoft Corporation’s support for our products or other software vendors do not design and
develop software to run on our products, our ability to sell our products could be materially adversely affected.
Our ability to innovate beyond the x86 instruction set controlled by Intel depends partially on Microsoft
designing and developing its operating systems to run on or support our x86-based microprocessor products.
With respect to our graphics products, we depend in part on Microsoft to design and develop its operating system
to run on or support our graphics products. Similarly, the success of our products in the market, such as our APU
products, is dependent on independent software providers designing and developing software to run on our
products. If Microsoft does not continue to design and develop its operating systems so that they work with our
x86 instruction sets or does not continue to develop and maintain their operating systems to support our graphics
products, independent software providers may forego designing their software applications to take advantage of
our innovations and customers may not purchase PCs with our products. In addition, some software drivers sold
with our products are certified by Microsoft. If Microsoft did not certify a driver, or if we otherwise fail to retain
the support of Microsoft or other software vendors, our ability to market our products would be materially
adversely affected.
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