AMD on its new direction, the iPad, and the transformation of the traditional PC

In a bid to reverse losses, AMD is looking to new areas outside of traditional PCs – most notably gaming.

We talked to Bernd Lienhard – corporate vice president and general manager of client division global business units – about the changing world of tech, Apple vs Microsoft, and a ‘different hype’ within the chip maker… 

PCR: So we’re told AMD is a changing company – what’s it changing into?

Lienhard: We wanted to use the brand to move into adjacent markets, and one of the first ones we picked was consoles. We’ve been able to secure the three major platforms: Playstation, Nintendo and Microsoft Xbox. All three major consoles in the world are now based on AMD technology.

The cool thing about it is, since all three games consoles are now based on AMD architecture, there’s only a few gaming engines out there, so when you’re looking to do a port for the machines they have to be very tailored to our architecture. 

All the major games and games engines are all going to be tied to our architecture, which is fantastic because they are going to run significantly better on AMD machines than anything else, whether that’s Nvidia or whoever.

We’re going to take that console dominance and take it into the cloud. Think of the console business as a new building block for diversifying and transforming AMD.

In the last quarter we believe about 20 per cent of our revenue came from the non-traditional (non-PC) space. And in the next few years that’s probably going be more like 50 per cent. So the AMD you used to know is probably not the same company anymore.

Is that because generally in the emphasis in tech has been moving away from traditional PCs?

It is – but still a 300 million-unit PC market is not a small one. But there’s always room for us to transform, change and grow.

This is not saying we’re going to abandon the classic PC space, but we are leveraging transitions within the market.

And your most recent financials were described as better than expected, what’s doing well at the moment?

We did beat guidance quite a bit, the numbers came in higher than even the top-rate predictions.

One of the biggest factors was computing space, up 12 per cent which is relatively big. And there was a share increase last quarter, so I know our friends at Intel probably aren’t going to be that happy. We achieved a relatively brutal step up in unit shipments. 

You can see from a thrust into the mobility space, which is mainly notebooks and tablets, that we have the strongest and broadest portfolio. You can see my team pushing more aggressively into the mobility space, because that’s where a lot of the transformation is going to happen. We have strong guidance going forward – a 20 per cent revenue increase next quarter, in line with the Playstation 4, Xbox One, embedded, semi custom and server.

When you come to a company you want to see some leadership – because it’s very difficult to compete in this world if you’re a ‘me too’. Our AMD Radeon brand is the best on the planet. And we’re using this IP and dropping it into the processors as well. 

For decades the CPU was seen as the dominating factor in how powerful a PC was. But these days it’s a combination of graphics as well as CPU horsepower. This is why we think the APU (accelerated processing unit) is the way forward. 

The way you interact with a machine is just different to how it was five or ten years ago. 

Which makes sense as things become more graphical, or touch-based…

The Microsoft ecosystem has been suppressing innovation for quite some time, and really was broke up by the time our friends from Apple introduced the tablet space. Because then, like that, it started giving these guys a run for there money. 

And now you can see PCs are starting to transform a bit more. AMD has been playing on the cheap end of notebooks. There was a time when you looked at Intel and you saw high performance products, and AMD was the opposite of it. Over the last 12 months we’ve been changing that perception. We now have some very, very cool high end products as well. 

But how much do people care about what chip their Xbox or laptop has in it? Are people actually making buying decisions on that?

There are a lot of ways people make decisions, one of those in online research. As a company we’re beefing up our online presence as in the past it wasn’t really very good. We’re catering our messaging more to tech savvy people.

Would you describe this as a comeback period for AMD?

We’ve proven over the last three quarters we can make it, we can beat it (financial predictions), and the outlook for this quarter and the quarters to come are significantly up.

There is a lot of excitement in the company now. Sometime AMD felt like it had been beaten in the past, but there’s a different hype in the company now. There’s success, market share gains, financial stability. There’s a lot of good momentum, and if you feel good, things are going to happen.