This summary is based on the fourth quarter fiscal 2005 earnings call conducted by Advanced Micro Devices (AMD: chart) on January 18, 2006.

Management:

Chairman, President and CEO: Hector Ruiz
CFO: Bob Rivet
EVP Worldwide Sales and Marketing: Henri Richard
Director, IR: Mike Hasse

Key Investor Issues:

- Fiscal 2005 sales were 17% higher at $5.85 billion versus fiscal 2004.
- Full year net income rose from $91 million last year to $165 million.
- Q1 of 2006 comparable sales are forecast to increase 70% versus Q1 of 2005.

Fiscal 2005 Financial Highlights:

- The company achieved record sales of $5.85 million, a 17% increase of 2004.
- The full year net income was $165 million or 40 cents per share.
- The annual results include a non-cash charge in Q4 of $110 million or 25 cents per share.
- The non-cash charge is associated with the reduction of AMD’s ownership in Spansion.
- The company’s reported sales in 2004 were $5 billion and net income was $91 million or 25 cents per share.

- Excluding the results of the Memory Products Group segment, full year sales were $3.94 billion.
- This represents an increase of 48% from fiscal 2004.
- The full year operating income was $543 million for fiscal 2005.
- The comparable sales in 2004 were $2.66 billion resulting in operating income of $187 million.
- The company Chairman, President and CEO Hector Ruiz was named “CEO of the Year” by Electronic Business magazine.

Fourth-Quarter Financial Highlights:

As a result of Spansion’s IPO, the company’s results of operations include Spansion’s financial results of operations as a consolidated subsidiary only through December 20, 2005.

- Due to this, the comparisons of fourth quarter consolidated financial results to previous periods do not correlate directly.
- The management has therefore provided non-GAAP financial statements that exclude Spansion and the Memory Segment results of operations.
- The company believes that the non-GAAP presentation will help investors by presenting the company’s current and historical results in a form that will be more consistent with the presentation of future operating results.

The fourth quarter sales of $1.84 billion increased 45% from Q4 of 2004 and 21% from Q3 of 2005.

- The sales are exclusive Spansion’s sales from the last five days of the quarter due to Spansion’s IPO.
- During Q4 of 2004, the company reported sales of $1.26 billion, operating income of $20 million and a net loss of $30 million or 8 cents per share.
- In the third quarter of 2005, the company reported sales of $1.52 billion, operating income of $79 million and net income of $76 million or 18 cents per share.

Excluding the sales of the Memory Products Group segment, Q4 sales were $1.35 billion.

- This represents an increase of 78% from Q4 of 2004 and 34% from Q3 of 2005.
- The comparable sales during the quarter were $760 million resulting in an operating income of $59 million.
- The comparable sales in Q3 of 2005 were $1.01 billion and operating income of $129 million.

The quarter end cash balance was $1.8 billion.

- This represents an increase versus $452 million in the third quarter.
- The increase was due to cash flow from operations and loan pay offs from Spansion.
- The debt was reduced by $639 million compared with the third quarter.
- This includes the $201 million convertible debt conversion and about $440 million of Spansion debt moving off the balance sheet.
- The company’s debt-to-capital ratio ended the year at 28%.


Business Review:

Record Computation Product Group (CPG):