UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

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ADVANCED MICRO DEVICES, INC.

(Name of registrant as specified in its charter)

(Name of person(s) filing proxy statement, if other than the registrant)

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On March 23, 2010, the Compensation Committee of the Board of Directors (the “Compensation Committee”) of Advanced Micro Devices, Inc. (the “Company”) adopted the policies set forth below concerning agreements with the Company (i) for taxes due as a result of pension payments to executives and (ii) for severance payments as a result of a termination of employment following a change in control of the Company. The Compensation Committee believes that these policies are consistent with best practices.

After the date of the adoption of this policy, the Company will not enter into any agreements with executive officers to reimburse them for any taxes incurred by them with respect to pension payments made to them by the Company.

After the date of the adoption of this policy, the Company will not enter into any change of control provisions with executive officers that would cause severance payments in the event of a termination of employment after a change in control of the Company to exceed (i) two times the sum of the executive officers’ (A) base compensation and (B) target annual bonus, plus (ii) a pro-rata bonus for the year in which such termination of employment occurs, assuming performance at target levels.