CEO

AMD's CEO prepares chipmaker for a fight

Reuters News
|
Posted: Feb 02, 2012 2:19 PM
AMD's CEO prepares chipmaker for a fight

By Noel Randewich

SUNNYVALE, California (Reuters) - Advanced Micro Devices' new chief executive delivered an enthusiastic pitch in his debut before Wall Street analysts, telling them he was getting the struggling PC chipmaker "fit to fight" in a quick-changing computer industry.

At AMD's first analyst day since 2010, Rory Read said the company would leverage its PC chip technology to attack the fast-growing mobile computing segment and emerging markets but stay away from the smartphone market.

"We're going to double down on client and mobility ... I'm not suggesting we dive into smartphones, a heavily crowded space with low margins ... I'm going to focus on client mobility, thin and light," Read said.

Much of AMD's focus recently has been on selling chips for laptops.

Read took the chipmaker's helm in August, ending a long search after CEO Dirk Meyer left over differences with AMD's board about the company's lack of progress making chips for increasingly popular mobile devices like smartphones and tablets.

Gesturing with his hands and delivering a presentation with the energy of a motivational speaker, and even jumping down from the two-foot-high stage when he finished, Read said AMD would focus on opportunities in cloud computing and growing demand from developing countries like China for entry level PCs and other devices.

Facing problems manufacturing a newly launched 32 nanometer PC chip, Read in November announced he was slashing 10 percent of AMD's workforce to save about $200 million in annual operating costs.

AMD this year will concentrate on improving its execution rather than pushing the envelope with new technology, he said.

"We don't want to be on the bleeding edge of technology where we're leading in with our chin and we don't execute cleanly and that breaks down trust."

AMD has long struggled to keep up with much larger Intel in powerful PC processors and now faces challenges from companies like Qualcomm that are planning to make low-end PC chips using power-sipping technology licensed to them by Britain's ARM Holdings.

With PC sales flagging, AMD and Intel have both failed to find a foothold in smartphones and tablets, where ARM chips are widely used.

Read, who was a top executive at PC maker Lenovo Group Ltd, has also brought on new cadre of senior executives in an apparent bid to reinvigorate AMD.

(Reporting By Noel Randewich; Editing by Steve Orlofsky)