AMD posts analyst meeting slides

The presentations amounted to three hours in all... Sheesh!

But now AMD has posted the slides to its Web site although there seems to be considerable pressure on its server(s) because we're finding them hard to download too. The AMD roadmap page we linked to in a separate story today is "temporarily unavailable".

The referring page is here.

We got all the way through to Dirk Meyer before our connection failed on us. Bill Siegle was quite interesting.

Hector "cost cutter" Ruiz claimed AMD was the first company to move to 130 nanometer technology.

On Flash, he said: "We were a company heavily focused on n/w and telecomms biz and because of the change of the market we've had to reinvent that. We've regained our leadership position in [microprocessor] performance."

The CFO, Robert Rivet, said "We are in the worst recession in the microprocessor business. Not too long ago we were a $5 billion business. Unfortunately today we're a $3 million business. We want to do things to stop the cash burn. The three biggest issues are... rebalancing the PC supply chain inventory, bolstering our capital structure and third reducing the breakeven point.

"We're about 90 per cent complete in the inventory rebalancing. We did secure a $150 million of new refinancing and in addition reduced our capex to less than $800,000. Last but not least, we've an action plan to reduce our cost structure by $100 million per quarter.

"The second phase of our plan is the show me phase. We have to prove not just to ourselves but to the outside world that we're viable". Operational Flexibility.

"In this business, you can't cut your way to success. The final phase of our plan is the payoff, but the ball's in our court to show you the results.

"Our real goal is to have a business model that makes money both in upcycles and down." The cost cutting will be to make us more flexible. Logistics might be an area we want to address, perhaps outsourcing logistics. We will be cutting SG&A by 25% by Q2 2003, a nine per cent decrease in R&D, and 40% out of manufacturing.

"Our plan is to really not hit the R&D effort very much. Our commitment to R&D remains very strong. We intend to focus on partnering with others to leverage the IP and make one plus one equal three".

"Unfortunately this will reflect a restructuring charge of several hundred millions of dollars. "We're expecting a very strong quarter [for Flash memory]. We're really making gains, particularly in Asia and Europe.

Microprocessor shipments are moving up for Christmas. "Our roadmap looks great for the fourth quarter."

"The semiconductor industry will grow next year and based on our forecasts we'll outgrow the market [in 2003]. We plan to be profitable for the year.

Rob Herb, head of sales and marketing, said that compound annual growth rate [CAGR] was in the 10 per cent range for semiconductor business. $150 billion today, $200 billion in 2004. "Geographically, Asia is driving the only growth we see in the market today. Asia represents nearly a third of overall semiconductor consumption. In 2003, IDC forecasts we'll see a return in growth on IT spending."

He said: "In the PC market we see CAGR of around 10 percent, with desktops representing about two thirds of that. But the mobile market is 16% CAGR. The server market is important to both AMD and to the market." Overall AMD share in the PC market remains very solid with a combined share according to Dataquest of almost 20%, said Herb. In desktop space AMD had just over 20% share in the last six quarters. "Most of our gains have come in the mobile market. AMD has made share gains while only playing in the full size notebook market, and not in the thin and light market. The good news for AMD is we'll ship our first thin and light products in this quarter. It's growing by 20%."

The desktop market is not nearly growing as fast, he said, in 2001/2002 it was virtually flat but it's still almost two thirds of the business. "We believe with our new roadmap we can gain back some of the share we've lost in recent quarters".

Overall the server market is small in terms of shipped systems. This is where AMD customers make all of their money. "We've made some progress in the server and white box market, we've yet to penetrate the tier one opportunities. However, I think we're on the verge of doing that."

"We're going to blow the competition away [with Hammer], he boasted".

Asia is the area of growth for Flash, and 2002 is the beginning of AMD's penetration into China. There will be a big opportunity for high density Flash. Fab 25 to move to 170 nanometer, 130 nanometer next year.

200 million Chinese students will use Tablet PCs using the Alchemy technology. "China is where the opportunity is."

Dr Bill Siegle, chief scientist at AMD was pretty interesting in contrast. He said the 130 nanometer process was fully completed at Fab 30 in the third quarter. Ninety nanometer comes next, with Hammer qualification at end of next year. Initial development on 200 millimeters and ship to 300 millimeters with production second half of 2005. Research projects for 45 nanometers in 2007.

He said 90 nanometer Mirrorbit Flash was in active development now, production in 2004.

Sledgehammer is two and half times more complex than Athlon but will run at the same power because of the SOI base, he claimed.

Strained silicon can help the electrons move faster if the silicon lattice is stretched using silicon germanium. AMD has built experimental products in conjunction with a company called Amberwave. Gate oxide is becoming vanishingly small, in today's devices the physical thickness is 10 to 15 angstrom layers, only a few atoms thickness.

He said AMD (and others, presumably), had reached the limit of scaling that particular material. Other dielectric materials are under investigation. Silicon dioxide replaced by a metal silicate. It has higher dielectric so you can make it thicker and still maintain performance. Improves leakage.

AMD is experimenting with dual gate technology which gives more current because of two conducting channels by wrapping the gate around a thin film of silicon. AMD has fabricated a device which confirms the improved current and so the improved performance.

"We're punching well above our weight in patents". Dresden is "giving excellent yields" on Hammer, with shipments, presumably samples, starting in December. Bertrand Cambou, of the [Flash] memory group was very excited about everything. AMD would almost double its Flash market share in Q4 of this year, he predicted.

Cambou got so excited about AMD's strategy he almost burst into tears of joy. In the past AMD's strategy was to use more mature technology but now the firm is accelerating logic technology at an unprecedented rate. AMD is only a couple of quarters away from 130 nanometer technology.

The new manufacturing strategy uses Fab 25 to Flash, with all microprocessors produced in Dresden. The conversion is complete. The factory will be a low cost model with only half the people Fab 25 employed this time last year, from 1500. Fab 25 will be the cheapest factory in the Flash industry.

Strataflash from Intel is expensive and doesn't have the performance of Mirrorbit. Half a gigabit design is in the pipe and on track.

China is the big growth area. This was a recurrent theme.

We'd been waiting for Dirk Meyer to start but only got the following before everything collapsed on the connection. "Application performance is the best measure of microprocesors. Canadian government has two standards for measuring PC performance using AMD's PR rating and Intel's GHz. "The EU gets it, consumers get it, governments get it, and the press gets it".

The slides still seem a bit difficult to download. Wonder what kind of servers AMD is using on its Web site? µ