"AMD PC processor revenues surged more than 50% sequentially, as we posted new records in both units and dollars," said W.J. (Jerry) Sanders III, chairman and chief executive officer of the company. "Average selling prices for AMD processors increased dramatically to $90 as the company rapidly ramped production and sales of the AMD Athlon XP processor, which was introduced in October."

The company now claims to have a 20% market share in PC processors, and AMD said its microprocessor unit shipments exceeded 7.8 million chips in Q4. AMD's PC processor revenues increased sequentially by 51% to $703 million in the fourth quarter, said company executives.

AMD also reported that its Memory Group sales -- principally flash memory products -- declined 7% sequentially due to continued weak demand from the networking and communications systems applications.

With a Q4 net loss of $0.05 per share, AMD easily beat Wall Street's consensus, which was a loss at $0.18 per share, according to First Call/Thomson Financial. The fourth quarter revenues topped AMD's previous guidance of a 10% sequential growth.

Looking ahead, the company said normal seasonal sales patterns in PC processors markets will result in a 5.5% sequential decline in overall sales to about $900 million in the first quarter of 2002. AMD said it expects PC processor unit shipments in Q1 will "remain at or near" the record level of 7.8 million units in the prior quarter, with average selling prices at or near the $90 level in Q4 of 2001.

AMD said demand for flash memory devices continues to be soft due to continuing weakness and an inventory overhang in the networking and communications sector.

"We believe AMD gained four percentage points of unit market share in 2001 even as the worldwide personal computer industry experienced its first year-to-year unit sales decline," Sanders said. "We believe total industry PC processor revenues declined by more than 20% last year. In this very tough environment, AMD PC processor revenues in 2001 grew by 3.5% over the prior year, and unit sales of AMD processors grew by 16% to nearly 31 million units."

During a conference call with analysts after posting the results, Sanders said AMD remains on track to return to profitability in the second quarter.

AMD also reported that it has started production of AMD Athlon processors on 130-nm (0.13-micron) technology in Fab 30 in Dresden, Germany, during the quarter.

Sanders said the Athlon XP processor die, produced on 180-nm (0.18-micron) technology, is 12% smaller than the recently introduced "Northwood" version of Intel Corp.'s Pentium 4 produced on 130-nm processes. "The AMD Athlon XP processor on 130-nm technology is just over half of the size -- 45% smaller -- of the Northwood die," Sanders said.