Advanced Micro Devices (AMD)
Q4 2011 Earnings Call
January 24, 2012 5:00 pm ET
Rory P. Read - Chief Executive Officer, President and Director
Thomas Seifert - Chief Financial officer, Principal Accounting officer and Senior Vice President
Mark Papermaster - Chief Technology Officer and Senior Vice President
Ruth Cotter - Director
Patrick Wang - Evercore Partners Inc., Research Division
Sanjay Chaurasia - Nomura Securities Co. Ltd., Research Division
John Pitzer - Crédit Suisse AG, Research Division
Glen Yeung - Citigroup Inc, Research Division
James Covello - Goldman Sachs Group Inc., Research Division
Kevin Cassidy - Stifel, Nicolaus & Co., Inc., Research Division
David M. Wong - Wells Fargo Securities, LLC, Research Division
Steven Eliscu - UBS Investment Bank, Research Division
JoAnne Feeney - Longbow Research LLC
Vivek Arya - BofA Merrill Lynch, Research Division
Previous Statements by AMD
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Thank you, and welcome to AMD's Fourth Quarter and Year End Earnings Conference Call. By now, you should have had the opportunity to review a copy of our earnings release and the CFO commentary. If you've not reviewed those documents, they can be found on AMD's website at quarterlyearnings.amd.com.
Participants on today's conference call are Rory Read, our President and Chief Executive Officer; Thomas Seifert, our Senior Vice President and Chief Financial Officer; and Mark Papermaster, our Senior Vice President and Chief Technology 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 (888) 266-2081. Outside of the United States, the number is (703) 925-2533. The access code for both is 1563304. The telephone replay will be available for the next 10 days starting later this evening.
I'd like to highlight a few dates for you. AMD's Financial Analyst Day will be held on February 2; Thomas Seifert will attend the Oppenheimer Semiconductor Summit on the 23rd of February in Vail, Colorado; and our first quarter quiet time will begin at the close of business on Friday, March 16 and will be followed by the announcement of our fourth quarter earnings, expected to be Thursday, April 19.
AMD's ownership of GLOBALFOUNDRIES on a fully diluted basis decreased to approximately 8.8% as of the conclusion of the fourth quarter. Reconciliation for all non-GAAP financial measures discussed today is included in the financial tables that accompany our earnings release, available in the Investor Relations section of amd.com.
Before we begin today's call, I'd 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 beliefs, 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. 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 AMD's quarterly report on Form 10-Q for the quarter ended October 2, 2011.
Now with that, I'd like to hand the call over to Rory. Rory?
Rory P. Read
Thank you, Ruth. 2011 was an important year of change for AMD. We took steps to optimize our business for today and position the company to seize the opportunities for tomorrow. We made good progress, but no question, we have more work to do.
First, we demonstrated that our innovation engine remains strong. The tremendous success of our low-power Brazos platform drove a 25% increase in mobile processor shipments and significant notebook share gains for the year. Brazos is, in fact, the most successful platform in our AMD history.
In Graphics, we exited the year the same way we entered it, with the world's fastest graphics chip. Our GPU IP provides us with superior video, multimedia and graphics capabilities that form the core of our competitive advantage.
And our Server business has regained momentum as adoption of the new Bulldozer-based CPUs continued to accelerate. As a result, we believe we gained overall microprocessor unit share for the year, and we are positioned well for growth as we continue to strengthen our differentiated product offerings.
Second, we continued to optimize our financial model, consistently delivering operating income and creating the foundation for sustained success. 2011 revenue was $6.57 billion, flat from 2010. And non-GAAP net income improved to $374 million, or $0.50 per share. Additionally, we significantly improved free cash flow as well, helping to strengthen our balance sheet.
Third, we took important steps to get fit to fight and write the next chapter for the AMD's history, a chapter that will be built on our rich heritage of innovation and improved execution. We strengthened our leadership team. The addition of industry veterans such as Mark Papermaster, Rajan Naik and Lisa Su will help ensure sustainable, dependable execution becomes the hallmark of the new AMD.
We implemented a restructuring plan and operational improvements in the fourth quarter. These actions will allow us to fund strategic initiatives designed to accelerate our growth by refining our focus on staking leadership positions in low power, emerging market and the cloud.