AMD to Invest US$2.5 Billion in Germany to Expand 300mm Microprocessor Production; Large Investment in Europe Underscores AMD's Leadership Strategy to Drive Microprocessor Manufacturing Innovation and Reduce Costs for End Customers

AMD (NYSE: AMD) today announced that it plans to expand
its microprocessor manufacturing capacity over the next three years by
adding additional 300 millimeter wafer production capabilities in
Dresden through the implementation of three new projects. AMD's newest
fabrication facility will come online through a major transformation
of the company's existing Fab 30, which will be named Fab 38. The
transition from 200mm to 300mm allows for more than twice as many
processors on a wafer. In addition, AMD will also expand Fab 36's
existing 300mm capacity and build a new clean room facility to handle
the site's growing Bump and Test requirements, which is one of the
final stages of the manufacturing process where wafers are prepared to
be shipped for packaging. With plans to invest a total of US$2.5
billion in the Dresden expansion projects, AMD continues to
aggressively scale its innovative manufacturing processes to meet
growing customer needs.
"As global demand continues to rise for AMD products, we are
scaling our manufacturing capacity intelligently to meet our
customers' growing needs," said Hector Ruiz, chairman of the board and
chief executive officer of AMD. "To achieve this, we are pursuing an
aggressive path to invest in and expand our top-rated manufacturing
capabilities in Dresden. These strategic investments highlight how
significant Germany and Europe are to the future of AMD
competitiveness. We expect that AMD's momentum and demand for our
products will continue to increase, fueled by our technology
leadership, our commitment to customer-centric innovation and the
continuing global antitrust scrutiny that will ensure truly
competitive markets."
AMD will ramp down 200mm manufacturing in the second half of 2007,
with preparation already underway for the ramp of 300mm wafers on 65nm
process technology at Fab 38 by the end of 2007. Through the
combination of leading-edge equipment, Automated Precision
Manufacturing (APM) and the great people of Dresden, the plant will
produce the latest generations of AMD microprocessors, reaching full
capacity by the end of 2008. The majority of the investment will go
into new equipment in the Fab 38 facility. AMD will also build a new
clean room facility on its Dresden campus for Bump and Test
requirements, which will support both fabrication facilities.
Previously, the clean room facilities for Bump and Test activities
were located within Fab 30 and Fab 36. By moving them into a new
facility in 2007, AMD has the ability to maximize production space at
both Fab 36 and Fab 38, providing increased output and capacity. These
three projects have the potential to increase Dresden-based
manufacturing to a full capacity of 45,000 300mm wafer starts per
month by the end of 2008.
"With the addition of Fab 36, AMD took a major step forward in
increasing output and scale for its global manufacturing and with this
announcement we raise the bar even further," said Daryl Ostrander,
senior vice president, logic technology and manufacturing,
Microprocessor Solutions Sector. "As we look ahead to aggressive
process technology transitions to 45nm and beyond, the ability to
continue delivering these technologies with world-class yields will
provide customers with incredibly sophisticated and agile
manufacturing capabilities, whereby we can continue to accommodate the
increasing demand for AMD products."

About AMD

Advanced Micro Devices (NYSE: AMD) is a leading global provider of
innovative microprocessor solutions for computing, communications and
consumer electronics markets. Founded in 1969, AMD is dedicated to
delivering superior computing solutions based on customer needs that
empower users worldwide. For more information visit www.amd.com.

Cautionary Statement

This release contains forward-looking statements concerning AMDs
plans for future capital expenditures, Fab 30, and its conversion to
Fab 38 and Fab 36, including its output and capacity, and demand for
AMD64-bit solutions, which are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Investors are cautioned that the forward-looking statements in this
release involve risks and uncertainties that could cause actual
results to differ materially from the company's current expectations.
Risks that the company considers to be the important factors that
could cause actual results to differ materially from those set forth
in the forward-looking statements include the possibility that global
business and economic conditions will worsen resulting in lower than
currently expected sales; that Intel Corporation's pricing, marketing
programs, product bundling, new product introductions or other
activities targeting the company's microprocessor business will
prevent attainment of the company's current microprocessor sales
plans; that demand for computers, and, in turn, demand for the
company's microprocessors will be lower than currently expected; that
adoption of AMD64 products by OEMs will not continue to occur as
expected; that the company may not achieve its current product and
technology introduction or implementation schedules; that the company
will not be able to raise sufficient capital to enable it to establish
leading-edge capacity to maintain its market positions and that
solutions providers will not timely provide the infrastructure to
support the company's AMD64 technology. We urge investors to review in
detail the risks and uncertainties in the company's Securities and
Exchange Commission filings, including but not limited to the Annual
Report on Form 10-K for the year ended December 25, 2005 and the
Quarterly Report on Form 10-Q for the quarter ended March 26, 2006.

AMD, the AMD Arrow logo, AMD64, and combinations thereof are
trademarks of Advanced Micro Devices, Inc. Other names are for
informational purposes only and may be trademarks of their respective
owners.