The CEO of AMD, Rory Read spoke at a Deutsche Bank tech conference earlier this week and the transcript makes interesting reading.
He’s pretty clear that AMD needs to diversify and to move to more profitable businesses, such as Pro Graphics. Gross margins there yield 50 percent to 70 percent. The next generation AMD server chips will deliver between 55 percent to 65 percent gross margin.
He said corporations started buying again and it’s not just the demise of Windows XP that is the reason. He said they will continue to do refreshes and there will be another four to eight reasonable quarters. Server chip sales at the commercial level will be good.
AMD is “over indexed” on consumer entry notebooks and that’s a problem, “it’s a dollars and cents play, both with the OEM and with the channel partners. You have got to diversify out.”
AMD is develping next generation products for 2015 and 2016 codenamed Carrizo.
He said AMD’s decision to go fabless was the right move and gives it more flexibility. He said 28 nanometre processors will be the dominant node for the next three to four years. It will move to 14 nanometre. He said that AMD’s relationship with Global Foundries (GloFo) has “fundamentally improved” over the past three years after a choppy relationship. TSMC will also play a role in the future.
