AMD Considers Its Chances: Outlines Three Growth Opportunities

AMD to Focus on Micro-Servers, Embedded Apps and Ultra-Mobile Entry-Level Devices

by Anton Shilov
10/19/2012 | 09:40 AM

Following the announcements of financial results for the quarter and the plan to layoff over 1700 employees, Advanced Micro Devices outlined three rapidly growing opportunities, which the company needs to address. AMD believes that it should focus on developing solutions for cloud servers, embedded applications and ultraportable/ultra low-power applications. Surprisingly, AMD did not note that it needs to keep its PC product line competitive as well.


“Our long-term strategy is to rebalance our business towards faster-growing segments of the market. Today, approximately 85% of our business is focused on the legacy PC portion of the market, [which is] projected to have slowing growth over the next several years. We intend to drive 40% to 50% of our portfolio to faster-growth markets where our IP is the key differentiator,” said Rory Read, chief executive officer of AMD, during a conference call with financial analysts.


There is a lot of hype about so-called micro-servers and cloud datacenter-optimized servers these days. Obviously, currently there are more talks about micro-servers/cloud servers than actual sales, but numerous companies are working on ARM-architecture chips optimized for servers. Earlier this year AMD acquired SeaMicro, a micro-server pioneer, therefore it will be clearly developing ULP server chips. Chief exec of AMD proposes to leverage the company’s “full suite of processor and graphics intellectual property, third-party processor cores and SeaMicro's supercompute fabric”. The head of AMD compares such processors to revolutionary AMD64 and Opteron, which turned AMD around almost a decade ago.

“The dense cloud market is one of the fastest-growing parts of the data center market. Our long-term path to success is in providing customers with disruptive technologies and choice, just as we did when we brought 64-bit computing to the mainstream server market with AMD 64,” said Mr. Read.

Embedded Applications

The market of embedded applications is large, yet pretty competitive. The head of AMD believes that the company has the right set of technologies – low-power x86 micro-architectures, graphics cores and other technologies – to develop custom solutions for embedded markets. He believes that the company may quadruple its embedded business in just one year time.

“We are focused on growing our share in targeted embedded markets. These include communications, industrial and gaming, which will outpace the PC industry growth for the foreseeable future. Our semi-custom APUs already have a number of confidential high-volume design wins in place. We plan for our embedded business to comprise approximately 20% of our quarterly revenue by the fourth quarter of 2013, up from 5% today,” proclaimed chief exec of AMD.

Ultra-Low Power Apps

The company, which is No. 2 supplier of microprocessors for personal computers these days, cannot ignore new form-factors like ultra-slim notebooks, tablets and so on. Therefore, AMD will continue to develop ULP accelerated processing units for inexpensive ultra-mobile devices in a bid to avoid direct competition with Intel. It is noteworthy that AMD still does not intend to develop anything for smartphones.

“We will continue to focus on driving down into the ultraportable and ultra low-power form-factors that continue to grow rapidly. APUs are ideally suited for these new products, from ultra-thins and tablets to a new breed of entry-level notebooks that will drive growth in the emerging markets,” said Rory Read.