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AMD Split Rumors Accelerating

By - Source: Tom's Hardware | B 10 comments

San Francisco (CA) - Hector Ruiz’ time at the AMD as we know it today is coming to an end. Ruiz recently stepped down from his role as CEO, but kept his position as chairman of the board with the purpose of launching AMD’s Asset Light and Asset Smart strategies, which are expected to split AMD into two entities. And this event is only weeks away, industry sources told TG Daily.

It is widely expected that Asset Light will part AMD into two companies - one that is led by newly crowned CEO Dirk Meyer and a focus on the development of chip technologies and a manufacturing arm that will take over AMD’s fabs. Our sources indicated that critical decisions are being made at this time and the official announcement of Asset Light and Asset Smart will be made next month.

Hector Ruiz’ future role remains a mystery, but it is expected that Ruiz will remain with AMD in one capacity or the other, possibly as CEO of the manufacturing company. We previously published an extensive analysis that sheds some light on the company’s future direction. It appears that much of Ruiz’ future has already been ironed out and AMD’s marketing team is now working on a way to preserve Ruiz’ legacy in AMD’s history books to avoid the perception that the executive caused the company’s current critical state.

Officially, there is virtually no clear information on the announcement and the direction of Asset Light/Smart provided by AMD. In the company’s Q2 earnings call, chief financial officer Bob Rivet stated the announcement will not be a 2009 event and that the company will announce it "as soon as [AMD] can get it down which is what Hector [Ruiz] is focused on."

Ruiz told Tim Luke, an analyst with Lehman Brothers, that the company has made "enormous progress" with Asset Smart and hopes that it will be able provide details about the deal "before the end of the year." Apparently, the company was able to remove any roadblocks that could have prevented a deal and will not have to raise additional capital - such as from the sale of manufacturing equipment. Rivet also stated that Asset Smart will not be a requirement for AMD’s break even goal - which, however, leaves out the general belief that hitting a break even point is a requirement for Asset Smart. At this point, AMD still says that it will "achieve that break even and actually make money in the back half of this year," according to Rivet.

It is clear that AMD will be a critical event for AMD and its employees. While AMD is not offering answers yet, our sources have had a good track record and we wish the company good luck! Ruiz offered an indication just how critical this step will be for AMD: "All I can tell you right now is that if it were something as simple as going to a foundry it would be very easy to do and talk about it but it is actually something we believe is uniquely tailored to AMD and uniquely tailored to our customers and our company and therefore much more complex to do than just a general outsourcing scenario."

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  • 0 Hide
    sandmanwn , August 12, 2008 11:24 AM
    just when you thought it was over, the little troll Ruiz pops his head up again.
  • 2 Hide
    B-Unit , August 12, 2008 12:40 PM
    Seriously, did he write the article or just copy and paste from like 3 others? If he did write it, his mastery of the English language leaves much to be desired...
  • 3 Hide
    jeb1517 , August 12, 2008 1:16 PM
    It is clear that AMD will be a critical event for AMD and its employees....They obviously just hit spell check and publish the article without reading it over even a single time.
  • 5 Hide
    smalltime0 , August 12, 2008 1:17 PM
    "It is clear that AMD will be a critical event for AMD and its employees"
    because that makes soo much sense.
  • 1 Hide
    Sus-penders , August 12, 2008 1:39 PM
    Ruiz again? He's quite skilled at loosing money.
  • 0 Hide
    jimmysmitty , August 12, 2008 3:04 PM
    I heard that Ruiz was doing what the CEO of Citibank did. Stepping down and then still hiding in the shadows of the board.

    If this does happen it will be interesting to see.
  • 4 Hide
    aevm , August 12, 2008 4:39 PM
    I read somewhere that they couldn't afford the golden parachute. That might explain the transfer...
  • 4 Hide
    creepster , August 12, 2008 5:01 PM
    Ruiz again? He's quite skilled at LOSING money.
  • 2 Hide
    Anonymous , August 12, 2008 7:45 PM
    'achieve that break even and actually make money in the back half of this year'

    Another website falling hook, line and sinker! AMD has repeatedly said OPERATING INCOME breakeven not NET INCOME breakeven. Clearly folks here don't understand the difference - not that it matter, because when you report the #'s you'll make the same mistake again.
  • -3 Hide
    mtbhrd , August 12, 2008 8:02 PM
    bah, I kept thinking it was saying AND, instead of AMD. I was like, alright, we get it, your making TWO points.