AMD Projects First Quarter Loss

AMD Projects First Quarter Loss

SUNNYVALE, CA -- 3/8/1999 -- Atiq Raza, AMD co-chief operating officer and chief technical officer, said today that the company will fall short of its goal of shipping 5.5 million units of AMD-K6® family processors in the current quarter. The shortfall will result in a significant loss for the quarter.

"We expect to ship no more than five million units of AMD-K6® family products in the first quarter," Raza said during remarks delivered at the Morgan Stanley Dean Witter "Semiconductor and Systems Conference" in Laguna Niguel. "As we said in January, design enhancements to increase the yield of higher-speed versions of the AMD-K6®-2 processor with 3DNow!® technology were successfully implemented. Those enhancements are delivering the results we anticipated, which include higher yields and a richer distribution of product at speeds of 400MHz and 450MHz. Our shortfall in units for the quarter is a result of the lower yields in the first eight weeks of the quarter on the wafers started prior to implementing the design enhancements.

"Demand for our desktop and mobile products remains strong," Raza continued. "We plan to ship a minimum of five million units in the second quarter and believe we will meet our goal of shipping 20 to 25 million microprocessors this year. The final number of units will depend on our product mix, which is subject to a variety of factors."

Raza also announced that the company has started production wafers on its seventh-generation processor, the AMD-K7™ , which is scheduled for introduction in June.

Cautionary Statement
This press release contains "forward-looking statements" which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally preceded by words such as "expects," "plans," "believes," "anticipates," or "intends." Investors are cautioned that all forward-looking statements in this release involve risks and uncertainty that could cause actual results to differ materially from current expectations. Forward­looking statements in this release involve the risk that the company will not achieve profitable growth. We urge investors to review in detail the risks and uncertainties detailed in the company's Securities and Exchange Commission filings, including the most recently filed Form-10K and Form-10Q.