Advanced Micro Devices (AMD)
Q3 2010 Earnings Call
October 14, 2010 5:00 p.m. ET
Dirk Meyer - President and Chief Executive Officer
Thomas Seifert - Senior Vice President and Chief Financial Officer
Ruth Cotter - Vice President, Investor Relations
Uchi Orji - UBS
John Pitzer - Credit Suisse
Glen Yeung - Citi
Jim Covello - Goldman Sachs
Doug Freedman - Gleacher & Company
Tim Luke - Barclays Capital
Shawn Webster - Macquarie
Ross Seymore - Deutsche Bank
Christopher Danely - JPMorgan
Ambrish Srivastava - Banker Montreal
Patrick Wang - Wedbush Securities
David Wong - Wells Fargo
Stacy Rasgon - Sanford Bernstein
Previous Statements by AMD
» Advanced Micro Devices Inc. Q2 2010 Earnings Conference Call
» Advanced Micro Devices, Inc. Q1 2010 Earnings Call Transcript
» Advanced Micro Devices Inc. Q4 2009 Earnings Call Transcript
Good afternoon. At this time I would like to welcome everyone to AMD's third quarter 2010 earnings conference call. [Operator instructions.] I would now like to turn the conference over to Ms. Ruth Cotter, vice president of investor relations for AMD. Please go ahead.
Thank you and welcome to AMD's third quarter earnings conference call. Our participants today are Dirk Meyer, our president and CEO, and Thomas Seifert, our chief financial officer. This is a live call and will be replayed via webcast on
. 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 1485779. The telephone replay will be available for the next 10 days, starting later this evening.
Before we start, I would like to highlight a few dates for you. Firstly, AMD will host its financial analyst day on November 9, in its company's Sunnyvale offices, in California. Also, Thomas Seifert, our CFO, will present at the Credit Suisse Technology Conference on the first of December in Arizona. And lastly, our fourth quarter earnings quiet time will begin at the close of business on Friday, the 10th of December.
Our class-A preferred share ownership in GLOBALFOUNDRIES decreased from 79% as of the end of the second quarter, to approximately 77% at the end of the third quarter, as a result of additional capital calls that ATEC participated in and AMD did not. As a result, AMD's ownership on a fully diluted basis also decreased to approximately 26%.
Reconciliation for all non-GAAP financial measures is included in our financial tables that accompany our earnings release, which is also available in the investor relations section of
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, 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 filing, AMD's quarterly report, and form 10Q for the quarter ended June 26, 2010.
Now, with that, I'd like to turn the call over to Dirk.
Thanks Ruth, and good afternoon to all of you on the call this afternoon. AMD's third quarter performance was a good demonstration of our capacity to execute profitably in the context of our [fabulous?] business model. Despite an environment of weaker than expected consumer demand, we improved operating income and non-GAAP free cash flow sequentially by continuing to focus on growth in the largest margin pools in our industry.
In our client business, we set an all-time record for notebook MPU shipments in the quarter. We saw sequential revenue gains in both our desktop and notebook processor product lines and an improved mix in our notebook offerings.
Our VISION campaign continues to pay dividends across our client business. As you may remember, VISION is designed to both differentiate AMD-based platforms and encourage sell up to more robust systems in mainstream retail. During the back-to-school period, our higher-end VISION Premium and Ultimate platforms accounted for roughly half of VISION-branded sales.
In our server business, we were pleased to add IBM to the list of customers offering AMD Opteron 6000-based systems in the third quarter. AMD OEM server partners, led by HP and Dell, now offer more than 40 6000-series platforms and over 20 4000-series platforms as of the end of this past quarter.
In graphics, we are about to complete our first full year of top to bottom DX11-enabled products. We were very pleased that Apple refreshed their Mac and Mac Pro desktop computers with our new Radeon GPU line, making Radeon GPUs the only graphics solution for all configurations of these products. To date, we have shipped over 25 million DX11 GPUs, and we will be launching our second-generation DX11 graphics offerings next week.
Customer and partner enthusiasm continues to grow for the industry's first accelerated processing units, or what we call the AMD Fusion family of APUs. Our first APU platforms, codenamed Brazos, and based on our Zacate and Ontario processors, are expected to bring many of the vivid digital computing experiences once reserved for high-end PCs to value and mainstream notebooks and desktops early next year.
Brazos is ahead of schedule, with customer shipments on track for the fourth quarter and customer systems available early next year. The AMD Fusion family is a game-changer that will significantly expand our addressable market and is already changing the way the industry harnesses the power of the GPU.