Advanced Micro Devices, Inc. (NYSE:AMD)
Annual Meeting of Stockholders
May 10, 2012 12:00 pm ET
Bruce L. Claflin - Chairman and Chairman of Nominating & Corporate Governance Committee
Harry A. Wolin - Senior Vice President, General Counsel and Secretary
Rory P. Read - Chief Executive Officer, President, Interim Chief Sales Officer and Member of The Board of Directors
John E. Caldwell - Director, Member of Audit & Finance Committee and Member of Nominating & Corporate Governance Committee
Bruce L. Claflin
Good morning, ladies and gentlemen. It's now 9 a.m. Pacific Time, and I'd like to call this meeting to order. Welcome to AMD's Annual Meeting of Stockholders. I'm Bruce Claflin, Chairman of AMD's Board of Directors and Chairman of the Nominating and Corporate Governance Committee.
I'd like to introduce the other board of director nominees, all of whom are here today. Please stand when I call your name. Mr. Rory P. Read, President and Chief Executive Officer; Dr. W. Michael Barnes, Director and Chair of the Audit and Finance Committee; Mr. John E. Caldwell, Director; Mr. Henry WK Chow, Director; Mr. Craig A Conway, Director; Mr. Nicholas M. Donofrio, Director; Mrs. H. Paulett Eberhart, Director and Chair of the Compensation Committee; Mr. Waleed Muhairi, Director; Mr. Robert B. Palmer, Director.
I'd also like introduce our Senior Vice President and Chief Financial Officer, Mr. Thomas J. Seifert. And our Senior Vice President, General Counsel and Corporate Secretary, Mr. Harry A. Wolin.
At our meeting this morning, we will first take care of the formal business of the meeting, then Mr. Read will give his report. This morning, we will also provide time for any questions you may have of our directors and officers.
In addition, representatives of Ernst & Young, our independent auditors are here and available for questions. This meeting is now called to order. As Chairman, I designate Mr. Harry Wolin as Secretary of the meeting. Mr. Wolin will now conduct the formal portion of the meeting.
Harry A. Wolin
Good morning. As set forth in the notice of the meeting, the official business to be conducted is as follows. First, to elect 10 directors to the board; second, to ratify the appointment of our independent auditors, third, to approve the amendment and restatement of Advanced Micro Devices, Inc. 2004 Equity Incentive Plan; fourth, to approve on the nonbinding advisory basis, the compensation of our named executive officers; and finally, to transact any other business that properly comes before the meeting.
Following the formal business of the meeting, the meeting will be adjourned and Mr. Read will deliver his report as Chief Executive Officer of the company. A stockholder question and answer session will follow.
I'd like to point out that management may be making forward-looking statements about the company's current plans and expectations. Actual results may differ materially from current plans and expectations, so I encourage you to review our SEC filings where we discussed the risks inherent to our business. You will find particularly detailed discussions in our most recent annual report on Form 10-K for the period ended December 31, 2011.
And finally, please hold your questions until after Mr. Read's report is concluded.
Now returning to the business of the meeting, I've been authorized by the Board of Directors to appoint Craig Dunlop [ph] of IBS Associates as Inspector of Elections for the meeting. Mr. Dunlop will determine the number of shares represented at this meeting, the validity of proxies, the existence of a quorum and the number of votes on all matters voted upon at this meeting.
Before we proceed further, is there anyone present who is not voted by proxy, who wishes to withdraw his or her proxy or who otherwise desires to vote in person at this meeting?
The Board of Directors fixed the close of business on March 12, 2012, as the record date for determination of the stockholders entitled to notice of this meeting and entitled to vote at this meeting.
I have a list of stockholders of the company from Compushare, our transfer agent, showing approximately 699,393,018 shares outstanding on the record date and entitled to a vote at this meeting. This list has been kept on file at our offices in Sunnyvale in Austin for the last 10 days and is available here at the meeting for inspection by any shareholder.
I also have an affidavit certifying that proxy materials for this meeting were first mailed on March 19, 2012, to all stockholders of record on March 12, 2012. The affidavit is available for review by any stockholder who may wish to see it after the meeting.
The count immediately before the commencement of this meeting of shares present, in person or by proxy, indicated that 562,200,628 shares of the company's voting stock were present, representing 80.38% of the outstanding shares of common stock as of March 12, 2012. Based on this number, a quorum is present. I now declare the polls open. The polls will close in approximately 10 minutes.
If there are any proxies that have not been filed, they should now be filed or if any stockholder would like to vote personally by ballot, please see Mr. Dunlop at the back of the room.
A copy of the minutes of the Annual Meeting of Stockholders of Advanced Micro Devices held on May 3, 2011, is in my possession for any shareholder who wishes to inspect them. We will respect the minutes of this meeting.
The election of directors is the first item on the agenda. The slate of directors recommended by the Board of Directors is described in the 2012 proxy statement. The 10 individuals has been nominated for election are Dr. W. Michael Barnes; Mr. John E. Caldwell; Mr. Henry WK Chow; Mr. Bruce L. Claflin; Mr. Craig a Conway; Mr. Nicholas M. Donofrio; Ms. H. Paulett Eberhart; Mr. Waleed Muhairi; Mr. Robert B. Palmer; and Mr. Rory P. Read.
AMD has adopted a majority voting standard for the election of directors, with respect to uncontested elections. The standard requires each director to receive a majority of the votes cast to be elected.
I now declare the nominations closed.
The second item is the ratification of the appointment of Ernst & Young as independent auditors for the company for the current year. The Board of Directors unanimously recommends this ratification.
The third item is to approve the amendment and restatement of the Advanced Micro Devices, Inc. 2004 Equity Incentive Plan to increase the number of shares authorized for issuance by 23 million and certain other changes. The Board of Directors unanimously recommends that you vote for this amendment.
The fourth item is to approve on a nonbinding advisory basis, the compensation of our named executive officers as disclosed in the 2012 proxy statement, pursuant to the compensation disclosure rules of the Securities and Exchange Commission, this is commonly known as Say-on-Pay. The Board of Directors unanimously recommends that you vote for this proposal.
Are there any comments from the floor on any of these items? If there is no discussion regarding the proposals, I direct the Inspector of Elections to conduct the voting on the items now before the meeting. The shares of any stockholder who has filed a proxy will be voted by the proxy holders in the manner specified on the proxy form. If there is anyone who has not filed a proxy or who wishes to withdraw his or her proxy and vote personally by ballot, please see Mr. Dunlop at the back of the room. I now declare the polls to be closed. Mr. Dunlop, can you please present the report of the Inspector of Elections?
Thank you, Mr. Secretary. I am pleased to announce that each of the nominees for director as offered by the board has been elected by the affirmative vote of the majority of votes properly cast and the appointment of Ernst & Young as the company's independent auditors has been ratified by the affirmative vote of the majority of the shares of common stock having voting power present and entitled to vote on such item.
The proposal regarding the Advanced Micro Devices, Inc. 2004 amended and restated Equity Incentive Plan passed by the affirmative vote of the majority of the votes cast.
The proposal concerning the advisory vote on the compensation of named executive officers passed by the affirmative vote of the majority of the votes cast. Any stockholder interested in the vote tallies on specific items may see me after the meeting for a copy of the results.
Harry A. Wolin
Thank you, Mr. Dunlop. The report of the Inspector of Elections will be on file for inspection of stockholders. On behalf of Mr. Claflin, the formal portion of the meeting is adjourned. And at this time, it's my pleasure to introduce AMD's President and Chief Executive Officer, Mr. Rory Read.
Rory P. Read
Thank you, Harry. It's an exciting day for me to stand here in front of my first annual stockholders meeting. And it was truly exciting to meet some of our shareholders before the meeting began.
I remember when I joined the company just 8 months ago, and I thought about what an exciting time in the tech industry it truly was and what inflection points we saw in front of us. The opportunities for a company like AMD almost seemed boundless at that time. And as I began my journey with the Board of Directors and all the employees of AMD across the planet, I felt the true and lasting, exciting -- excitement emerge over the last 8 months. And I can tell you with deep and honest -- the depth, that I believe today more than the day I started in this opportunity in front of us. This inflection point that's affecting the market around consumerization, the cloud and convergence across devices, it's just beginning. But it's going to have a huge ramification in terms of where the market goes and what we can do as a company and where this company can make a difference for our customer, our partners and across the planet. We'll continue to focus and to continue to drive this company forward to capture this inflection point.
AMD has a long history and a rich history of round innovation and discovering what's next. It's an exciting time because we have a unique portfolio and an opportunity to capture this agile, flexible architecture that's in front of us. I think it's a powerful time for us to see what's next.
And as I think today in this shareholder meeting and I think about what we've accomplished over the first 8 months, I'm truly excited about the new announcements that will occur even next week around the ultrathin environment and what we're going to announce with our new Trinity processor. Those processors are positioned for us to capture this key opportunity, where we can bring thin and light to the masses across the world.
And if you think about it, where is the next 2 billion customers going to come across the planet? They will come in the emerging market. In markets like Russia and China, Brazil and China -- I missed 1. Which 1 did I miss? India. Thank you, team. We see that opportunity, where are they going to purchase those devices? They're going to buy in the mainstream at entry price points. Those are the areas that we've been very successful in over the past 12 months. We've added over 4 points of market share in the last quarter alone according to IDC. And we've refreshed our entire product line from top to bottom in 2011. We've seen us focus in terms of our vivid next-generation computing around the APU model and the client opportunity that's in front of us. It is an opportunity where we see huge growth.
Think about Brazos. Last year, we introduced Brazos family as the first-generation APU. And at Brazos family, 30 million units sold in the first year alone. The most successful and fastest ramping platform we've ever had.
And are we dedicated, driven around our graphics opportunity? For sure, we ship more graphics engines around direct X11 than we've ever shipped before, over 100 million units. This is real innovation leadership. And it not only fuels our momentum around the graphics engine, but captures the momentum around the APU.
And then again, we launched the new Bulldozer family of Opteron 64 base server processors, and we saw a significant progress in that launch around server momentum. The kind of product introduction around the market trends that are emerging, and you can truly see an exciting time for AMD. This is an opportunity that comes around to the industry only so often. And as it comes along, we must capture that. How do we capture this inflection? How do we see this next generation of technology users across the planet in the emerging market? How do we see them become everything about the cloud? And how do we take advantage of our innovation and IP across the portfolio of devices as convergence moves across our industry? From tablets to laptops, desktops, televisions, game consoles. There's a huge opportunity in front of us. How do we capture it? First, by focusing on execution. We must build the trust and the energy around our company that every customer, every partner, every investor feels that when we make a commitment, we deliver on that commitment. Every day is an opportunity for us to drive a company that delivers on its commitment and builds trust. And when trust is there, our customers, our partners, they will give us additional business. It's inevitable. See the launch around HP last night and their sleek book as this ultrathin phenomenon begin. Our execution around Trinity has been substantial and excellent. We've got great product and great volume ramps, in terms of allowing our customers to go to market quickly. We'll announce Trinity next week. And last night, we saw HP announce some of the most beautifully-designed Ultrathins, what they call sleek books using our Trinity design around the world.
This is the beginning of a new trend for AMD, where we can drive true innovation leadership, making a difference for every customer and allowing them to create the value in every part of their life and their job. That's what AMD is about. It's about finding the innovation, the market trend and using our 7,000 to 8,000 engineers to create the solution that allows that vision and innovation to come to life. When we create value for those customers, they win. And when they win, AMD wins. This is our future, this is our destiny. AMD needs to embrace these changes that are emerging in the marketplace. And as they emerge, we need to capture them. These emerging opportunities are large and significant. They'll break down the status quo, the proprietary control points that have dominated our industry for the past 2 decades are beginning to shift. New competitors will emerge. And as they emerge, AMD needs to embrace that change. Facilitate that change. Be a disruptive force in the market. As we do that, we will feel that, that opportunity turn into results, and results start this year around an execution model that delivers on our commitment and every commitment and every quarter, every day around the planet. Next year, we look for momentum. And the year after that, around capturing the innovation opportunity that's in front of us.
AMD should think about the market, its customers and its partners as the lifeblood of our future and the energy that will create the transformation of this company. Step-by-step, AMD has been focused over the last 8 months to improve our processes, to see the market differently, to step out of the shadows and to begin to lead to make a company that is truly a force and a partner in the industry of change. This change is real. Mark my word that this inflection point is real and it is occurring.
Consumerization, the high-growth market, the cloud and convergence are trends that have just begun. And over the next decade, they will change the industry. And as AMD becomes an execution engine, reliable and delivers on its commitments every single day with an eye and a mind around innovation that captures this true inflection point, we will create a different AMD, one that we're all proud of, with an energy and a commitment to what matters, creating value for our customers, our employees, our partners and a sustained value around innovation that's built to last. A company that sees the future and captures the future. That's the AMD that I'm part of and that's the AMD we're creating. We bring -- we've been bringing in new and exciting leaders to our team and our employees across the planet are excited about this opportunity. They see it as an opportunity to write a new chapter in the history of AMD. Watch closely as we continue to execute our plan step-by-step first in improving our execution. Second, seeing where the market opportunity is and seizing that opportunity.
I'm proud to be a part of this team, and I'm super, super excited to have the opportunity to be in the position here today in my first AMD stockholder meeting ever.
I think it's truly an exciting time for AMD, an exciting time for the industry. But even so, it's a truly exciting time for me personally. It's an honor and a privilege to have had the opportunity to share just a few words about what I think the future of AMD is, and why we will capture this moment and build a company to last with sustaining value that will make us all proud to say we're AMDers. Thank you.
Bruce L. Claflin
So at this time, I'd like to invite questions from the floor from any of our directors or our officers.
Bruce L. Claflin
Well, I have question from John.
John E. Caldwell
You're a stockholder for many, many years. The reason why I bought AMD is because we were innovators at the time in the 80s and going against Intel and like -- and you mentioned Hewlett-Packard, these people are geared and ready for their new adventure. What is AMD going to do? I haven't heard your name come up in a long time?
Rory P. Read
Well, John, I think this is a really interesting point. So if you look at this inflection point and people are gearing up for this change, look at AMD as a company with over 8,000 engineers. We created innovations over the last 12 months. And with our next-generation chips that are coming out right here right now around Trinity and Brazos 2 and our next-generation Opteron chip, you will see a company that's generating innovative ideas that match the market trend. APUs have been created because they're built for the cloud. Think about how cloud is changing the compute model and how applications and people use their devices. AMD is creating solutions with our silicon and our IP to knit together the answer that allows that new computer model, that new generation of devices to perform better at lower power, at better performance per watt, and it will create a better experience on the screen. You're right, it's time for AMD to step forward and demonstrate and communicate those innovations. Show the marketplace with our partners and our customers the value we can create. The reason we added those multiple points this year in laptop is because our customers saw the value and the experience they had on the glass. They saw it firsthand. And this is beginning to create momentum and change. We need to follow that through, day in and day out, by delivering on our commitments, John. We must seize this moment. And we must communicate that value in every opportunity we have. I believe it's an exciting time with Trinity -- with the launch of Trinity and the work that we're doing with HP and some of the other players across the industry. And you'll see a significant number of new platforms. As matter of fact, in the most recent design cycle, we won more new design wins than we've ever won with the top 11 PC player vendors on the planet, top 11 out of 12 PC vendors on the planet. More design wins than ever. And the leadership team spent time in India and Russia over the past few weeks. Why? Because we want to have firsthand knowledge of the market and the market events that are going on and communicate across the market of how we're going to win and how we can create value for them. I hope that helps, John. Appreciate the question. Other questions?
Okay. With that, thank you, all for the time and I'll pass it back to the Secretary.
Harry A. Wolin
Well, with that, I'd like to thank you, all for attending this morning, and this will end and our event, so please help yourself to coffee and rolls out the lobby and thank you very much.
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