Advanced Micro Devices, Inc. (AMD)
Q1 2010 Earnings Call
April 15, 2010 5:00 pm. ET
Ruth Cotter – Director Investor Relations and Treasury
Derrick Meyer – President, Chief Executive Officer
Thomas Seifert – Chief Financial Officer
Tim Luke – Barclays Capital
Uchi Orji – UBS
Glen Yeung – Citi
John Pitzer – Credit Suisse
[Cody Acree – Williams Financial]
[Shawn Lester – Macquarie]
Ross Seymore – Deutsche Bank
David Wong – Wells Fargo Security
Stacy Rasgon – Sanford Bernstein
Doug Freedman – Broadpoint AmTech
James Covello – Goldman Sachs
Craig Berger – FBR Capital Markets
Hans Mosesman – Raymond James
Patrick Wang – Wedbush Securities
[Jake Kanaty – Morgan Stanley]
Srini Pajjuri – CLSA
Previous Statements by AMD
» Advanced Micro Devices Inc. Q4 2009 Earnings Call Transcript
» Advanced Micro Devices Inc. Q3 2009 Earnings Call Transcript
» Advanced Micro Devices Inc. Q2 2009 Earnings Call Transcript
Thank you and welcome to AMD’s first quarter earnings conference call. Our participants today are Derrick Meyer, our President and CEO, and Thomas Seifert, our Chief Financial Officer.
This is a live call and will be replayed via webcast on AMD.com. There will also be a telephone replay. The number is 88-266-2081. Outside of the United States, the number is 703-925-2533. The access code for both is 1446133. The telephone replay will be available for the next ten days starting later this evening.
Before we start, I’d like to highlight that AMD will attend UBS’s investment conference on June 9 in New York and that our second quarter quiet time will begin at the close of business on Friday, June 11.
Last January, we announced that we deconsolidated Global Foundries as of the first quarter of 2010 and began accounting for our ownership interest under the equity method of accounting. AMD has an ownership stake in Global Foundries, which is reflected in the equity and net losses investee line of our statement of operations.
For your information, our Class A preferred share ownership decreased from 3% to 82% as a result of the capital call that took place on the first of April. [Atip] participated in the cash call and AMD did not. As a result, AMD’s ownership on a fully diluted basis also decreased to approximately 30% as of the second quarter of 2010.
Reconciliation of all non-GAAP financial measures are included in our financial tables that accompany our earnings release available on the investor relations section of AMD.com.
Before we begin today’s call, I would like to caution everyone that we will be making forward-looking statements about management’s expectations. Investors are cautioned that those statements are based on current believes, assumptions and expectations speak only as of the current date and involve risks and uncertainties that could cause actual results to differ materially from our current expectations.
The semiconductor industry is generally volatile and market conditions are particularly difficult to forecast, especially in light of the current state of the economy. We encourage you to review our filings with the SEC where we discuss the risk factors that could cause actual results to differ materially from our expectations.
You’ll find detailed discussions about such risk factors in our most recent SEC filings, AMD’s annual report on Form 10-K for the year ended December 26, 2009.
With that, let me now hand it over to Derrick.
Thanks Ruth, and thanks to everybody on the call for joining us today. As I said at our analyst event back in November, our priorities this year are to deliver compelling platforms, increase access to customer demand and transform our business model.
In the first quarter of this year, we made good progress on each of these priorities, and an improving global economic environment, we delivered record first quarter revenue coupled with good operating performance.
Our platform execution continued to be solid across the board, with key new products transitions initiated in each of our main businesses. In graphics, we shipped a total over six million DX enables units to date, and expanded the family into the mainstream and value segments.
In addition, we unveiled the industry’s first DX 11 products for notebooks where we continue to grow share. Demand for all of our DX 11 products is very healthy and continues to outpace supply.
We are seeing strong support for our MD Vision program, an innovative campaign designed to simplify the consumer buying experience at retail, showcase the benefits of an all AMD solution and increase up sell. Today, over 50% of AMD’s notebook systems in the market are Vision branded, enabling us to participate more thoroughly in higher price bands.
Meanwhile, in servers, demand for the new AMD Opteron 6000 series has been strong with HP, Dell and Acer all announcing new platforms at launch. These are the world’s first eight and twelve core processors, delivering on customer needs for more cores and more memory for less money.
OEM interest in our AMD Opteron 4000 series has been strong as well. The 4000 series is on track for launch this quarter.
AMD momentum in notebooks is growing as we expand our platform footprint and our list of top tier customers. We were very pleased to add [Linobo] to the list of customers attracted to our unique value proposition in notebooks, and we continue to see strong end customer demand for a vivid digital experience coupled with strong battery life and real world application scenarios. To that end, customer interest in our Danube and Nile platforms is very promising.