“We lead through our customer-centric innovation approach, with our world-class design and manufacturing performance, and as a result of the discipline of operational excellence.”
— Hector Ruiz, Ph.D., Chairman of the Board and Chief Executive Officer

• February: AMD64 Architecture achieves significant milestones
• April: AMD launches two new APM centers for 300mm technology
• May: AMD establishes Advanced Micro Devices (China) Co.,Ltd.
• May: AMD Fab 36 topping ceremony
• July: AMD announces the AMD Sempron™ Processor Family
• August: AMD demonstrates world's first x86 Dual-Core Processor
• September: AMD establishes Greater China headquarters in Beijing
• October: AMD launches PIC in support of 50x15 Vision
• November: Spansion unveils ambitious vision and strategic road map

2004 was a year of significant milestones and accomplishments in our mission to deliver technology solutions that benefit our global marketplace.

In 2004, AMD64 technology became a defining force in the PC industry, delivering cutting-edge innovations in upgradeability, security and performance. AMD designed the AMD64 platform for best-in-class performance from 32-bit applications and to allow seamless migration to new 64-bit applications. It provides a single architecture for servers, desktops, and mobile platforms, and offers customers a broad choice of operating systems including Windows®, Solaris and Linux. By February 2004, less than a year from its introduction, more than 1,000 software and hardware developers, OEMs, systems builders and end users had recognized the benefits of AMD64 architecture.

The performance and 32-/64- bit compatibility of AMD64 processors has earned AMD enthusiastic support from commercial customers of all sizes. By the end of 2004, 40 percent of the Fortune Global 100 companies or their affiliates had adopted 64-bit AMD Opteron™ processor-based systems to run critical enterprise applications.

International praise for AMD64 processors extends across all platforms and by the end of 2004, the AMD64 platform had earned prestigious recognition including more than 80 industry awards and accolades from leading publications and organizations. This recognition demonstrates the powerful results that AMD can achieve developing technology solutions designed for customers’ needs.

In July 2004, we redefined everyday computing with the launch of the new family of AMD Sempron™ processors for desktop and notebook PCs. The AMD Sempron and Mobile AMD Sempron processors are designed to deliver best-in-class performance and a full-feature set to meet the dramatically expanding day-to-day computing needs of home and business PC users, which include downloading music, photo editing, movie viewing, Web conferencing, and advanced office productivity. In November 2004, we extended the product family by introducing the new Mobile AMD Sempron processor 3000+ for thin and light notebooks, offering true mobility with extended system battery life, connectivity through compatibility with today’s most popular wireless solutions, and cutting-edge security.

In August 2004, we delivered another industry first with a demonstration of the world’s first x86 dual-core processor, designed to deliver more efficient processing power without the penalty of increased power consumption and heat dissipation. AMD expects the dual-core AMD Opteron processor to provide better performance on a majority of server/workstation workloads by combining two processing cores on a single die. In addition to being the first to help eliminate the bottlenecks inherent in x86 front-side bus architectures, AMD demonstrated the capabilities of being the first to directly connect two cores on the same die along with the memory controller, I/O and other processors – an arrangement that vastly improves overall system performance and efficiency. This technology leadership benefits our customers and helps provide our partners a competitive advantage in the market. Demonstrating our architectural leadership and vision of meeting ever-changing customer needs, AMD plans to introduce a full dual-core processor line-up for the server and workstation market in mid-2005 with dual-core processors for the client market expected to follow in the second half of 2005.

Advanced computing solutions demand world-class manufacturing capability and we have consistently maintained high-efficiency, high-output manufacturing to deliver those solutions. In April 2004, we announced we had formally opened two new Automated Precision Manufacturing (APM) Innovation Centers located in Austin, Texas, USA and Dresden, Germany. APM is our proprietary, patented suite of more than 400 leading-edge fab automation and optimization technologies to speed products to market and decrease manufacturing costs. The new centers will be used by our manufacturing technologists and software designers to integrate the next generation of APM into AMD Fab 36, AMD’s 300 millimeter wafer manufacturing facility currently under construction in Dresden. This new facility, which had its topping-off ceremony in May 2004, is on schedule and on budget to begin production shipments in the first half of 2006.

During 2004, Spansion LLC, the venture of AMD and Fujitsu Limited, was the largest company in the world dedicated exclusively to developing, designing, and manufacturing Flash memory products. With an unwavering commitment to our customers’ success, Spansion offers the broadest NOR Flash memory portfolio in the industry for use in the wireless, automotive, networking, telecommunications and consumer electronics markets. In November 2004, Spansion announced an ambitious three-year vision and strategic road map, outlining plans to scale its MirrorBit™ technology to 8 gigabit densities on 65-nanometer lithography to meet the growing demands of the entire Flash market — from wireless handsets and embedded systems to detachable cards and USB drives. In addition, Spansion announced plans to develop a new “ORNAND” Flash memory architecture that brings together the best of NOR code execution and NAND data storage capabilities in a single product. Spansion’s strategy to create a new ORNAND architecture that transcends traditional boundaries of memory and storage presents an opportunity for customers to significantly extend the capabilities of next generation of digital devices. The first of Spansion’s new ORNAND products is expected to become available in 2005 with burst-write speeds up to four times faster than current NAND products, and all the inherent benefits of MirrorBit NOR technology, including high reliability and fast read speeds.

Our customers reside in a global marketplace and, in recent years, China has emerged as one of the most significant growth markets in the world. In the words of Dr. Hector Ruiz, AMD's chairman of the board, president and chief executive officer, “Success requires a strong global footprint, especially in growing population centers where tomorrow’s future products, applications, and solutions are being developed. If AMD is to be successful in general, we must be successful in China specifically.” During 2004, we took important steps in China. In March, AMD received approval to establish a second, state-of-the-art back-end manufacturing facility in the Suzhou Industrial Park, which began preliminary operations in November. In May, we established Advanced Micro Devices (China) Co., Ltd. and in September announced plans for the formation of a Greater China headquarters in Beijing to be responsible for all operations in China, Hong Kong, and Taiwan. This new headquarters will help ensure AMD’s operations are aligned with the needs of the China market. It will also allow us to further expand local partnerships, develop localized products and services, and consistently enhance our technology offerings to deliver better choices to our customers and end users in the region. Throughout 2004, we earned growing market recognition in the region with a number of significant product launches and alliances with leading OEMs and multi-national corporations in China, including Lenovo, Founder, Thunis, Dawning, IBM, HP, and Sun.

As a global technology provider, AMD possesses a keen understanding of the digital disparity that exists in high-growth regions of the world. In January 2004, AMD announced a bold and far-reaching initiative, called 50x15, to empower 50 percent of the world’s population with affordable Internet access and computing capability by the year 2015. In October we formally unveiled a business strategy to work with — and create opportunities for — local manufacturing, distribution and financial partners throughout the world. That same month, we also introduced the first of a new breed of products under the 50x15 initiative, the Personal Internet Communicator (PIC). The PIC is an innovative consumer device that enables affordable, managed Internet connectivity and offers Microsoft® Windows-based computing capabilities to help fulfill the needs of people and organizations in high-growth markets. We launched the PIC initially with TATA Group in India, CRC in Mexico, and Cable and Wireless in the Caribbean. We continue to work with our other customers in global high-growth markets.

We completed 2004 with a full year of profitability that underscored that the underlying tenets of partnership are core values at AMD and, we believe, essential to our future. We work in partnership with our customers to understand their changing needs and to develop and deliver technology solutions to help make them successful. Their success is our success.