What is the primary purpose of this 8-K filing?

The primary purpose of this 8-K filing is to announce and provide details on Advanced Micro Devices, Inc. (AMD) financial results for its fiscal quarter ended October 1, 2011, in accordance with SEC regulations.

Why is AMD providing so many non-GAAP financial measures?

AMD provides these non-GAAP measures to offer investors a clearer view of its ongoing operating performance and to facilitate comparisons between current and historical periods. They exclude certain items like amortization, GF-related items, and debt repurchase losses, which the company believes are not indicative of its core business operations.

How has the accounting treatment for GLOBALFOUNDRIES (GF) changed?

AMD deconsolidated GF's results starting in Q1 2010 and initially accounted for its investment under the equity method. Beginning in Q1 2011, AMD transitioned to accounting for its investment in GF under the cost method. This change impacts how GF's financial performance is reflected in AMD's results, particularly when calculating non-GAAP figures.

What is the significance of the terminated IBM Credit LLC agreement?

The supplier agreement with IBM Credit LLC, which involved the sale of distributor invoices and was treated as debt and financing cash flow under GAAP, was terminated in February 2011. This termination means that the previous adjustments made to calculate non-GAAP adjusted free cash flow related to these distributor payments are no longer applicable in the current reporting period.

AMD 8-K: Earnings & Results & Regulation FD

Summary

This 8-K filing by Advanced Micro Devices, Inc. (AMD) on October 27, 2011, primarily provides details on the company's financial results for the fiscal quarter ended October 1, 2011. Investors should note that AMD has provided a significant amount of non-GAAP financial measures, including non-GAAP net income, non-GAAP operating income, Adjusted EBITDA, and non-GAAP adjusted free cash flow. The company states these measures are intended to offer a clearer view of its core operating performance and facilitate comparisons across reporting periods by excluding certain items. Key adjustments made to GAAP figures include the exclusion of equity income/loss from GLOBALFOUNDRIES (GF) (as AMD moved to the cost method of accounting for GF in Q1 2011), amortization of acquired intangible assets (primarily related to the ATI acquisition), and losses on debt repurchases. The filing also details the termination of a supplier agreement with IBM Credit LLC in early 2011, which impacts the calculation of non-GAAP adjusted free cash flow by removing previous financing arrangements. Investors are urged to review these non-GAAP measures in conjunction with the company's GAAP financial statements.

Key Highlights

1AMD announced its financial results for the fiscal quarter ended October 1, 2011, via an 8-K filing.
2The company is extensively using and presenting non-GAAP financial measures to supplement its GAAP results.
3Key non-GAAP adjustments include excluding GLOBALFOUNDRIES (GF) related items (equity income/loss), amortization of acquired intangibles, and losses from debt repurchases.
4AMD transitioned from the equity method to the cost method of accounting for its investment in GF starting in Q1 2011.
5The company repurchased $150 million of its 6.00% Convertible Senior Notes due 2015 in Q3 2011, resulting in a $5 million loss.
6The supplier agreement with IBM Credit LLC was terminated on February 11, 2011, impacting how non-GAAP adjusted free cash flow is calculated.
7The filing emphasizes that non-GAAP measures are not a substitute for GAAP results and should be read in conjunction with the company's audited financial statements.

ADVANCED MICRO DEVICES INC 8-K Report, Financial Results (Oct 27, 2011)

Summary

Key Highlights

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