AMD To Provide Transmeta Efficeon Microprocessor Supporting Microsoft FlexGo Technology In Emerging Markets

June 5, 2006

—Specialized Efficeon Microprocessor designed to support pay-as-you-go personal computing platforms enabled by Microsoft FlexGo for emerging markets—

SUNNYVALE, Calif. and SANTA CLARA, Calif. -- --AMD (NYSE: AMD) and Transmeta Corporation (NASDAQ:TMTA) today announced that they have entered into an exclusive agreement under which AMD will market and provide the recently announced specialized version of the Efficeon® microprocessor in emerging markets. The AMD Efficeon microprocessor was specifically designed by Transmeta to provide a secure hardware foundation for FlexGo, Microsoft Corp.’s new technology that enables pay-as-you-go and subscription computing models. The AMD Efficeon offers robust CPU level security that delivers asset protection in a product that is available today to meet the needs of the new business models enabled by Microsoft FlexGo.

Microsoft’s FlexGo technology, and the pay-as-you-go and subscription computing models it enables, combined with AMD’s Efficeon processor, will accelerate AMD’s 50x15 initiative in new and important ways. Under 50x15, AMD is establishing a global network of partners and business models to help connect 50 percent of the world’s population to the Internet by the year 2015. Current global Internet penetration stands at about 15 percent. Through the AMD Efficeon product, OEM and other partners will have a robust CPU based Microsoft FlexGo implementation that can be readily adapted to both mobile and desktop system designs. The AMD Efficeon product was used to create the first hardware implementation for FlexGo and is the first CPU based FlexGo product. Further, the AMD Efficeon product is now being utilized in the second Brazil FlexGo trials that were launched by Microsoft on May 22nd of 2006.

“The AMD Efficeon processor is the industry’s first microprocessor designed specifically to support Microsoft FlexGo technology,” said Billy Edwards, AMD chief innovation officer and senior vice president. “The Efficeon processor will allow consumers in high-growth markets to obtain computers that are provided on a pre-paid basis using either tokens or pre-paid activation cards. This same business model was instrumental in establishing massive global penetration for cell phones and we believe we can adapt it specifically to achieve the goals of AMD’s 50x15 Initiative.”

“AMD’s worldwide channels and consumer brand will accelerate the penetration of this specialized Efficeon microprocessor into high volume emerging markets,” said Arthur L. Swift, president and chief executive officer, Transmeta Corporation. “We look at this announcement as the beginning of a very successful collaboration between AMD and Transmeta to bring Microsoft FlexGo technology to market. Our goal, in conjunction with AMD, is to leverage Transmeta’s unique microprocessor architecture and bring affordable solutions quickly to market for the hundreds of millions of potential Personal Computer users in emerging markets.”

“Microsoft has worked with the Efficeon product for several years in our FlexGo development efforts, and we are impressed with the security capabilities and versatility of this CPU,” said Will Poole, senior vice president of the Market Expansion Group at Microsoft. “The combination of the deep AMD experience in the 50x15 initiative and the advanced security capabilities of the AMD Efficeon will accelerate the availability of attractively priced PCs with Microsoft FlexGo in emerging markets.”

Pay-as-you-go and subscription computing enabled by Microsoft FlexGo technology is the latest addition to AMD’s solution portfolio targeted to support AMD’s 50x15 initiative. The diversity of cultures, local preferences and application needs for emerging markets demands a large portfolio of solutions, including the pay-as-you-go business model, value-based desktop and laptop solutions, AMD’s Personal Internet Communicator (PIC), thin client devices developed by companies such as Sun and Wyse Technology, and the upcoming One Laptop Per Child (OLPC) device targeted for education in these markets. AMD and its partners are building ecosystems that bring the full range of hardware, software, infrastructure (electrical power and similar), micro-financing expertise, and entrepreneurial experience to emerging markets.

About 50x15
AMD’s 50x15 initiative is a bold and far-reaching effort to develop new technology and solutions that will help enable affordable Internet access and computing capability for 50 percent of the world’s population by the year 2015. With the global population estimated to reach 7.2 billion people in 2015, there is tremendous potential for 50x15 to bring billions of people into the digital age.

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.

About Transmeta Corporation
Transmeta Corporation develops and licenses innovative computing, microprocessor and semiconductor technologies and related intellectual property. Founded in 1995, we first became known for designing, developing and selling our highly efficient x86-compatible software-based microprocessors, which deliver a balance of low power consumption, high performance, low cost and small size suited for diverse computing platforms. We now also provide, through strategic alliances and under contract, engineering services that leverage our microprocessor design and development capabilities. In addition to our microprocessor product and services businesses, we also develop and license advanced power management technologies for controlling leakage and increasing power efficiency in semiconductor and computing devices. To learn more about Transmeta, visit www.transmeta.com.

Safe Harbor Statement
This release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements speak only as of the date of this release, and the Companies will not necessarily provide updates of projections or other forward-looking statements. Investors are cautioned that such forward-looking statements are subject to many risks and uncertainties, and may differ materially or adversely from actual results or future events. We urge investors to review each Company’s filings with the Securities and Exchange Commission, including the most recent reports on Forms 10-K, 10-Q and 8-K, which describe these and other important risk factors that could have an adverse effect on results. The Companies undertake no obligation to revise or update publicly any forward-looking statement for any reason.

AMD, the AMD Arrow logo, and combinations thereof are trademarks of Advanced Micro Devices, Inc. Transmeta and Efficeon are trademarks of Transmeta Corporation. All other product or service names mentioned herein are the trademarks of their respective owners.

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