Ex-AMD Boss Hector Ruiz: Spinning-Off the Manufacturing Facilities Was Crucial for AMD’s Survival

Hector Ruiz Reveals the Story of His Days at AMD in New Book

by Anton Shilov
02/14/2013 | 11:57 PM

Hector Ruiz, the former chief executive officer of Advanced Micro Devices made everything he could in order to spin-off the company’s manufacturing facilities and sell them to rich investors from Abu Dhabi. The man who left AMD over four years ago believes that in case he had not sold the costly semiconductor facilities, AMD would have not survived.

 

“If the Abu Dhabi deal were to fall through, AMD would not survive. I had to do everything in my control to make it happen,” wrote Hector Ruiz in his book called Slingshot: AMD’s Fight to Free an Industry from the Ruthless Grip of Intel, reports the Wall Street Journal.

While Hector Ruiz was at the head of AMD, the company gained market share from Intel Corp. thanks to award-winning K8 processor design, which development started long before Mr. Ruiz took the helm. Unfortunately, by the time Mr. Ruiz left the company in 2008, the firm's market shares almost returned to their historical levels. Hector Ruiz was the second chief executive of AMD who took the CEO seat after Jerry Sanders, a co-founder of AMD retired after 33 years at the company. While he did solve a number of problems for AMD, he also created new challenges because of rather controversial decisions.

As the top executive of the world’s second largest supplier of microprocessors on the planet, Mr. Ruiz carried out a lot of difficult and controversial decisions. In a bid to gain graphics processor, chipset and platform technologies he endorsed the acquisition of ATI Technologies in 2006 (after failing to negotiate Nvidia Corp. to merge with AMD), which caused years of financial woes for the company, but defined the future AMD and to some extent the whole industry. He then sold off manufacturing facilities in order to pay back debts and cut-down expense to develop new manufacturing technologies and upgrade fabs, a rather controversial decision that reduced AMD’s competitive positions against Intel. The manufacturing spin-off also led to one of the most difficult moments in Mr. Ruiz’s career; he decided he had to join the new foundry company to reassure the investors about his commitment to the project.

The early success of Mr. Ruiz as the head of AMD was defined by technologies (e.g. x86-64, K8 micro-architecture, HyperTransport bus, etc.) designed while Mr. Sanders was the chief executive officer. The technologies which development started under Mr. Ruiz’s leadership – Bulldozer and Bobcat micro-architectures – have not managed to become breakthroughs of the industry like the AMD64 technology a decade ago.

During his tenure as AMD chief executive, Mr. Ruiz spent a great deal of time trying to sue Intel for anticompetitive business practices. In many ways, the legal battle against the chip giant distracted Mr. Ruiz attention from day-to-day decision making and slowed-down innovation at AMD, which led to subsequent losses of money and market share. AMD only received $1.25 billion from Intel, which did not admit any wrong-doings, to end the litigation. Still the FTC ordered the world’s top chipmaker to cease a number of business practices.

“Although I never expected the lawsuit to go to trial, I harbored hopes that Intel would admit wrong-doing. I also believed AMD merited damages well beyond the $1.25 billion,” wrote Mr. Ruiz.

After Hector Ruiz left AMD, it turned out that he provided information about AMD to hedge funds. Following the reports about the leak of confidential information, Mr. Ruiz resigned from GlobalFoundries.

“Slingshot” book is co-written with journalist Lauren Villagran and is set for publication April 23.