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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 $2.5 billion in the Dresden expansion projects, AMD continues to aggressively scale its innovative manufacturing processes to meet growing customer needs. While AMD's chip designs have won converts among computer makers, including Dell Computer, the company has lagged Intel in using new manufacturing processes that boost the technical capabilities of chips and reduce the cost of producing them. Intel has already converted most of its microprocessor production to 12-inch silicon wafers, which offer lower average manufacturing costs than older eight-inch wafers. For the fourth quarter of 2005, AMD shipped 21.4 percent of all desktop and laptop CPUs worldwide, up from 17.7 percent in the third quarter and 16.9 percent in Q1 2005. According to a recently released report from Mercury Research, AMD’s first-quarter market 2006 share growth reflected substantial gains in the x86 server market and now represents 22.1 percent, a 26-percent increase over AMD’s share in the fourth quarter of 2005 and a 254-percent increase over the first quarter of 2005.
"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."
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