SAN FRANCISCO--Advanced Micro Devices is embarking on a turn-around
strategy that rests on a simple premise: The PC market and its basic
architecture are dead.
Seizing on a market and design evolution that some argue AMD has
been slow to exploit, the company came out this week with a mea
culpa and a three-pronged strategy for long term growth that
recognizes the quickening decline of the core personal computer
market and its design assumptions.
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"We underestimated the speed of change in our industry," AMD
Rory Read said in an analyst call this week (Oct. 19).
"We expected we'd have several years to transform the AMD business,
but we must implement our transformation on a more aggressive
Staggered by falling revenues in its core business and major staff
cuts two years running, AMD is charting a future that hinges on an
aggressive push into the embedded markets, a significant
transformation of design into heterogeneous computing and the
potential of its $334 million acquisition of SeaMicro in server
applications. It's all part of a broader strategy to remake the
onetime Intel x86 second-source company as a system-on-chip
Goal: Quadruple embedded share
Read and Lisa Su, senior vice president and general manager of global
business units, said AMD will expand its embedded business from 5
percent of overall revenues to 20 percent in the next 12 months.
"The key differentiator we have is really in the high-performance
design methodology, microprocessor technology as well as the
graphics IP that we have," Su said.
Executives said they are targeting embedded markets in gaming,
industrial and communications, and the company already has a number
of "confidential" design wins they refused to disclose. When
pressed, Su declined to name potential competition for AMD in the
"Our low-power APUs, graphics IP and reusable design
blocks give us a distinct advantage for building semi-custom APUs
(Accelerated Processor Units) for new embedded markets, which
will outpace the PC industry for the foreseeable future," Read said.