Welcome!

Cloud Expo Authors: Roger Strukhoff, Pat Romanski, Gilad Parann-Nissany, Elizabeth White, Trevor Parsons

News Feed Item

AMD Amends Wafer Supply Agreement With GLOBALFOUNDRIES

SUNNYVALE, CA -- (Marketwire) -- 12/06/12 -- AMD (NYSE: AMD) today announced that it successfully amended its Wafer Supply Agreement (WSA) with GLOBALFOUNDRIES Inc.

The closure of amendment negotiations solidifies AMD's new operating model as communicated at the third quarter 2012 earnings announcement.

To better align with today's PC market dynamics, AMD and GLOBALFOUNDRIES agreed on purchase commitments for fourth quarter 2012 and established fixed pricing and other terms of the WSA which apply to products AMD will purchase from GLOBALFOUNDRIES through Dec. 31, 2013.

"Today's announcement demonstrates that the long-term strategic partnership between AMD and GLOBALFOUNDRIES continues to benefit both companies," said Rory Read, president and chief executive officer, AMD. "GLOBALFOUNDRIES' performance in meeting our delivery requirements in 2012 was strong and they remain a strategic and important foundry partner moving forward. We are committed to develop and grow our business with GLOBALFOUNDRIES, increasing our engagement across our industry leading APU and graphics roadmaps. The newly amended agreement is another step we are taking to further strengthen our relationship with GLOBALFOUNDRIES as well as AMD's financial foundation."

Announcement details:

  • AMD lowered its wafer purchase commitments for the fourth quarter 2012.
    • AMD currently estimates that it will purchase wafers from GLOBALFOUNDRIES for approximately $115 million in the fourth quarter 2012 and $1.15 billion in fiscal 2013. AMD has also committed to purchase wafers from GLOBALFOUNDRIES for approximately $250 million during first quarter 2014.
    • AMD expects to negotiate the remainder of its 2014 purchase commitments from GLOBALFOUNDRIES in 2013.
  • AMD will make a termination payment of $320 million related to the take-or-pay agreement with GLOBALFOUNDRIES associated with the adjusted wafer purchase commitments in fourth quarter 2012.
    • The cash impact of the termination fee will spread over several quarters:
      • $80 million by Dec. 28, 2012;
      • $40 million by Apr. 1, 2013; and
      • A $200 million promissory note issued by AMD to GLOBALFOUNDRIES due on Dec. 31, 2013.
    • The termination fee will result in a net one-time charge of approximately $165 million(1) recorded in the fourth quarter 2012.

Separately, as AMD moves to standard 28nm process technology, AMD will reduce future reimbursements to GLOBALFOUNDRIES for certain research and development costs.

As a result of the amendment, AMD expects to return to free cash flow generation in the second half of 2013.

AMD Teleconference
AMD will hold a conference call at 2:30 p.m. PT (5:30 p.m. ET) Thursday, Dec. 6, 2012 to discuss the amendment to its Wafer Supply Agreement with GLOBALFOUNDRIES. AMD will provide a real-time audio broadcast of the teleconference on the Investor Relations page of its website at ir.amd.com. The webcast will be available for 90 days after the conference call.

About AMD
AMD (NYSE: AMD) is a semiconductor design innovator leading the next era of vivid digital experiences with its groundbreaking AMD Accelerated Processing Units (APUs) that power a wide range of computing devices. AMD's server computing products are focused on driving industry-leading cloud computing and virtualization environments. AMD's superior graphics technologies are found in a variety of solutions ranging from game consoles, PCs to supercomputers. For more information, visit http://www.amd.com.

Cautionary Statement
This release contains forward-looking statements concerning AMD, its operating model, estimated payments to GLOBALFOUNDRIES for wafer purchases under the Wafer Supply Agreement, AMD's ability to negotiate the remainder of its 2014 purchase commitments from GLOBALFOUNDRIES in 2013; a charge in the fourth quarter of 2012 and its ability to return to free cash flow generation in the second half of 2013 which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are commonly identified by words such as "would," "may," "expects," "believes," "plans," "intends," "projects," and other terms with similar meaning. Investors are cautioned that the forward-looking statements in this release are based on current beliefs, assumptions and expectations, speak only as of the date of this release and involve risks and uncertainties that could cause actual results to differ materially from current expectations. Material factors and assumptions that were applied in making these forward-looking statements include, without limitation, AMD's current expectations regarding GLOBALFOUNDRIES manufacturing yields and wafer volumes and demand for its products. Risks include the possibility that Intel Corporation's pricing, marketing and rebating programs, product bundling, standard setting, new product introductions or other activities may negatively impact the company's plans; the company may be unable to develop, launch and ramp new products and technologies in the volumes that are required by the market at mature yields on a timely basis; that the company's third party foundry suppliers will be unable to transition its products to advanced manufacturing process technologies in a timely and effective way or to manufacture the company's products on a timely basis in sufficient quantities and using competitive technologies; the company will be unable to obtain sufficient manufacturing capacity or components to meet demand for its products or will not fully utilize its commitment with respect to GLOBALFOUNDRIES microprocessor manufacturing facilities that customers stop buying the company's products or materially reduce their operations or demand for the company's products; that the company may be unable to maintain the level of investment in research and development that is required to remain competitive; that there may be unexpected variations in the market growth and demand for its products and technologies in light of the product mix that the company may have available at any particular time or a decline in demand; that the company will require additional funding and may be unable to raise sufficient capital on favorable terms, or at all; that global business and economic conditions will not improve or will worsen; that demand for computers will be lower than currently expected; and the effect of political or economic instability, domestically or internationally, on the company's sales or supply chain. Investors are urged to review in detail the risks and uncertainties in the company's Securities and Exchange Commission filings, including but not limited to the quarterly report on Form 10-Q for the quarter ended Sept. 29, 2012.

AMD, the AMD Arrow logo, and combinations thereof, are trademarks of Advanced Micro Devices, Inc. Other names are for informational purposes only and may be trademarks of their respective owners.

(1) The accounting impact of the termination payment will result in a one-time charge of approximately $210 million offset by a $45 million credit in the fourth quarter of 2012. The $45 million credit was owed for wafer purchases under the 2012 Amendment to the WSA but is no longer owed under the terms of the third Amendment. Approximately $110 million of the $320 million termination payment will be capitalized into inventory in the fourth quarter 2012.

Add to Digg Bookmark with del.icio.us Add to Newsvine

EDITORIAL CONTACT:
Drew Prairie
(512) 602-4425
drew.prairie@amd.com

INVESTOR CONTACT:
Irmina Blaszczyk
(408) 749-3398
irmina.blaszczyk@amd.com

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Cloud Expo Breaking News
File sync and share. Endpoint protection. Both are massive opportunities for today’s enterprise thanks to their business benefits and widespread user appeal. But one size does not fit all, especially user-adopted consumer technologies. Organizations must apply the right enterprise-ready tool for the job in order to properly manage and protect endpoint data. In his session at 14th Cloud Expo, Michael Bachman, Senior Enterprise Systems Architect at Code42, he will discuss how the synergy of an enterprise platform – where sync/share and endpoint protection converge – delivers incredible value for the business.
Simply defined the SDDC promises that you’ll be able to treat “all” of your IT infrastructure as if it’s completely malleable. That there are no restrictions to how you can use and assign everything from border controls to VM size as long as you stay within the technical capabilities of the devices. The promise is great, but the reality is still a dream for the majority of enterprises. In his session at 14th Cloud Expo, Mark Thiele, EVP, Data Center Tech, at SUPERNAP, will cover where and how a business might benefit from SDDC and also why they should or shouldn’t attempt to adopt today.
Today, developers and business units are leading the charge to cloud computing. The primary driver: faster access to computing resources by using the cloud's automated infrastructure provisioning. However, fast access to infrastructure exposes the next friction point: creating, delivering, and operating applications much faster. In his session at 14th Cloud Expo, Bernard Golden, VP of Strategy at ActiveState, will discuss why solving the next friction point is critical for true cloud computing success and how developers and business units can leverage service catalogs, frameworks, and DevOps to achieve the true goal of IT: delivering increased business value through applications.
APIs came about to help companies create and manage their digital ecosystem, enabling them not only to reach more customers through more devices, but also create a large supporting ecosystem of developers and partners. While Facebook, Twitter and Netflix were the early adopters of APIs, large enterprises have been quick to embrace the concept of APIs and have been leveraging APIs as a connective tissue that powers all interactions between their customers, partners and employees. As enterprises embrace APIs, some very specific Enterprise API Adoption patterns and best practices have started emerging. In his session at 14th Cloud Expo, Sachin Agarwal, VP of Product Marketing and Strategy at SOA Software, will talk about the most common enterprise API patterns and will discuss how enterprises can successfully launch an API program.
MapDB is an Apache-licensed open source database specifically designed for Java developers. The library uses the standard Java Collections API, making it totally natural for Java developers to use and adopt, while scaling database size from GBs to TBs. MapDB is very fast and supports an agile approach to data, allowing developers to construct flexible schemas to exactly match application needs and tune performance, durability and caching for specific requirements.
The social media expansion has shown just how people are eager to share their experiences with the rest of the world. Cloud technology is the perfect platform to satisfy this need given its great flexibility and readiness. At Cynny, we aim to revolutionize how people share and organize their digital life through a brand new cloud service, starting from infrastructure to the users’ interface. A revolution that began from inventing and designing our very own infrastructure: we have created the first server network powered solely by ARM CPU. The microservers have “organism-like” features, differentiating them from any of the current technologies. Benefits include low consumption of energy, making Cynny the ecologically friendly alternative for storage as well as cheaper infrastructure, lower running costs, etc.
Next-Gen Cloud. Whatever you call it, there’s a higher calling for cloud computing that requires providers to change their spots and move from a commodity mindset to a premium one. Businesses can no longer maintain the status quo that today’s service providers offer. Yes, the continuity, speed, mobility, data access and connectivity are staples of the cloud and always will be. But cloud providers that plan to not only exist tomorrow – but to lead – know that security must be the top priority for the cloud and are delivering it now. In his session at 14th Cloud Expo, Kurt Hagerman, Chief Information Security Officer at FireHost, will detail why and how you can have both infrastructure performance and enterprise-grade security – and what tomorrow's cloud provider will look like.
Web conferencing in a public cloud has the same risks as any other cloud service. If you have ever had concerns over the types of data being shared in your employees’ web conferences, such as IP, financials or customer data, then it’s time to look at web conferencing in a private cloud. In her session at 14th Cloud Expo, Courtney Behrens, Senior Marketing Manager at Brother International, will discuss how issues that had previously been out of your control, like performance, advanced administration and compliance, can now be put back behind your firewall.
More and more enterprises today are doing business by opening up their data and applications through APIs. Though forward-thinking and strategic, exposing APIs also increases the surface area for potential attack by hackers. To benefit from APIs while staying secure, enterprises and security architects need to continue to develop a deep understanding about API security and how it differs from traditional web application security or mobile application security. In his session at 14th Cloud Expo, Sachin Agarwal, VP of Product Marketing and Strategy at SOA Software, will walk you through the various aspects of how an API could be potentially exploited. He will discuss the necessary best practices to secure your data and enterprise applications while continue continuing to support your business’s digital initiatives.
The revolution that happened in the server universe over the past 15 years has resulted in an eco-system that is more open, more democratically innovative and produced better results in technically challenging dimensions like scale. The underpinnings of the revolution were common hardware, standards based APIs (ex. POSIX) and a strict adherence to layering and isolation between applications, daemons and kernel drivers/modules which allowed multiple types of development happen in parallel without hindering others. Put simply, today's server model is built on a consistent x86 platform with few surprises in its core components. A kernel abstracts away the platform, so that applications and daemons are decoupled from the hardware. In contrast, networking equipment is still stuck in the mainframe era. Today, networking equipment is a single appliance, including hardware, OS, applications and user interface come as a monolithic entity from a single vendor. Switching between different vendor'...
Cloud backup and recovery services are critical to safeguarding an organization’s data and ensuring business continuity when technical failures and outages occur. With so many choices, how do you find the right provider for your specific needs? In his session at 14th Cloud Expo, Daniel Jacobson, Technology Manager at BUMI, will outline the key factors including backup configurations, proactive monitoring, data restoration, disaster recovery drills, security, compliance and data center resources. Aside from the technical considerations, the secret sauce in identifying the best vendor is the level of focus, expertise and specialization of their engineering team and support group, and how they monitor your day-to-day backups, provide recommendations, and guide you through restores when necessary.
Cloud scalability and performance should be at the heart of every successful Internet venture. The infrastructure needs to be resilient, flexible, and fast – it’s best not to get caught thinking about architecture until the middle of an emergency, when it's too late. In his interactive, no-holds-barred session at 14th Cloud Expo, Phil Jackson, Development Community Advocate for SoftLayer, will dive into how to design and build-out the right cloud infrastructure.
You use an agile process; your goal is to make your organization more agile. What about your data infrastructure? The truth is, today’s databases are anything but agile – they are effectively static repositories that are cumbersome to work with, difficult to change, and cannot keep pace with application demands. Performance suffers as a result, and it takes far longer than it should to deliver on new features and capabilities needed to make your organization competitive. As your application and business needs change, data repositories and structures get outmoded rapidly, resulting in increased work for application developers and slow performance for end users. Further, as data sizes grow into the Big Data realm, this problem is exacerbated and becomes even more difficult to address. A seemingly simple schema change can take hours (or more) to perform, and as requirements evolve the disconnect between existing data structures and actual needs diverge.
SYS-CON Events announced today that SherWeb, a long-time leading provider of cloud services and Microsoft's 2013 World Hosting Partner of the Year, will exhibit at SYS-CON's 14th International Cloud Expo®, which will take place on June 10–12, 2014, at the Javits Center in New York City, New York. A worldwide hosted services leader ranking in the prestigious North American Deloitte Technology Fast 500TM, and Microsoft's 2013 World Hosting Partner of the Year, SherWeb provides competitive cloud solutions to businesses and partners around the world. Founded in 1998, SherWeb is a privately owned company headquartered in Quebec, Canada. Its service portfolio includes Microsoft Exchange, SharePoint, Lync, Dynamics CRM and more.
The world of cloud and application development is not just for the hardened developer these days. In their session at 14th Cloud Expo, Phil Jackson, Development Community Advocate for SoftLayer, and Harold Hannon, Sr. Software Architect at SoftLayer, will pull back the curtain of the architecture of a fun demo application purpose-built for the cloud. They will focus on demonstrating how they leveraged compute, storage, messaging, and other cloud elements hosted at SoftLayer to lower the effort and difficulty of putting together a useful application. This will be an active demonstration and review of simple command-line tools and resources, so don’t be afraid if you are not a seasoned developer.