Sales for the third quarter of 1996 amounted to $456,862,000, which resulted in a net loss of $38,362,000, or $0.28 per share.

In the immediate-prior quarter, AMD reported sales of $594,561,000. Second-quarter net income amounted to $9,968,000, or $0.07 per share, fully diluted.

For the first nine months of 1997, the company reported total revenues of $1,743,204,000, which resulted in a net loss of $8,756,000, or $0.06 per share. For the first nine months of 1996, AMD reported total revenues of $1,456,151,000, which resulted in a net loss of $47,707,000, or $0.35 per share. Revenues increased by 20 percent over the first nine months of 1996.

"In this traditionally slow summer quarter, aggregate revenues from our non-microprocessor businesses -- our Communications Group, our Memory Group, and Vantis -- were essentially flat with the immediate-prior quarter, and up 12 percent from the same period of 1996," said W.J. Sanders III, chairman and chief executive officer.

"Revenues from AMD-K6™ MMX™ enhanced processors increased by 50 percent to more than $150 million. The loss in the third quarter was due to disappointing yields in the production of AMD-K6 MMX™ enhanced processors," Sanders continued. "Shipments of AMD-K6 processors rose from 350,000 units in the immediate-prior quarter to one million units in our third quarter. While to date we have executed the steepest microprocessor unit production ramp in AMD history, yield and speed-grade improvements have lagged our expectations.

"Average selling prices (ASPs) for K6 processors fell sharply from the immediate-prior quarter. The decline in ASPs was influenced by two factors: aggressive price cuts that became effective during the quarter, and a lower proportion of 233-megahertz devices than planned.

"Demand for AMD-K6 processors remains strong and our customer base has continued to expand. Achieving our planned production goal of approximately two million units in the current quarter will require progress in improving yields. No activity within the company has higher priority or more focus than increasing production of K6 processors through higher yields and migration to the next-generation 0.25-micron process," Sanders concluded.

Cautionary Statement
This press release contains forward-looking statements about management's expectations of future performance. Investors are cautioned that all forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from current expectations.

About AMD
AMD is a global supplier of integrated circuits for the personal and networked computer and communications markets. AMD produces processors, flash memories, programmable logic devices, and products for communications and networking applications. Founded in 1969 and based in Sunnyvale, California, AMD had revenues of $2 billion in 1996. (NYSE: AMD).