When the two companies' vision for Advanced Micro Computers diverged, AMD bought out Siemens' stake in the American division in 1979. The two companies also jointly established Advanced Micro Computers (AMC), located in Silicon Valley and in Germany, allowing AMD to enter the microcomputer development and manufacturing field, in particular based on AMD's second-source Zilog Z8000 microprocessors. Siemens purchased 20% of AMD's stock, giving the company an infusion of cash to increase its product lines. In 1977, AMD entered into a joint venture with Siemens, a German engineering conglomerate wishing to enhance its technology expertise and enter the American market.
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When Intel began installing microcode in its microprocessors in 1976, it entered into a cross-licensing agreement with AMD, which was granted a copyright license to the microcode in its microprocessors and peripherals, effective October 1976. By 1975, AMD entered the microprocessor market with the Am9080, a reverse-engineered clone of the Intel 8080, and the Am2900 bit-slice microprocessor family. Intel had created the first microprocessor, its 4-bit 4004, in 1971. By 1975, AMD was producing 212 products – of which 49 were proprietary, including the Am9102 (a static N-channel 1024-bit RAM) and three low-power Schottky MSI circuits: Am25LS07, Am25LS08, and Am25LS09. The company was a second source for Intel MOS/ LSI circuits by 1973, with products such as Am14/1506 and Am14/1507, dual 100-bit dynamic shift registers. That year AMD also greatly increased the sales volume of its linear integrated circuits, and by year-end the company's total annual sales reached US$4.6 million. In 1971, AMD entered the RAM chip market, beginning with the Am3101, a 64-bit bipolar RAM. Its best-selling product in 1971 was the Am2505, the fastest multiplier available. Also in 1970, AMD produced its first proprietary product, the Am2501 logic counter, which was highly successful. In November 1969, the company manufactured its first product: the Am9300, a 4-bit MSI shift register, which began selling in 1970. The company guaranteed quality control to United States Military Standard, an advantage in the early computer industry since unreliability in microchips was a distinct problem that customers – including computer manufacturers, the telecommunications industry, and instrument manufacturers – wanted to avoid. AMD first focused on producing logic chips. To immediately secure a customer base, AMD initially became a second source supplier of microchips designed by Fairchild and National Semiconductor. In September 1969, AMD moved from its temporary location in Santa Clara to Sunnyvale, California. Robert Noyce, who had developed the first silicon integrated circuit at Fairchild in 1959, had left Fairchild together with Gordon Moore and founded the semiconductor company Intel in July 1968. He later decided to leave to start his own semiconductor company. Sanders, an electrical engineer who was the director of marketing at Fairchild, had, like many Fairchild executives, grown frustrated with the increasing lack of support, opportunity, and flexibility within the company.
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