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AMD's Su says engineers transitioning from PC culture

A Hewlett-Packard Pavilion dv2 laptop with an AMD Yukon platform (L) is shown next to a laptop displaying the "Engine Room" Notebook Design
A Hewlett-Packard Pavilion dv2 laptop with an AMD Yukon platform (L) is shown next to a laptop displaying the "Engine Room" Notebook Design

By Noel Randewich

LAS VEGAS (Reuters) - A senior executive at Advanced Micro Devices said the chipmaker's plan to expand beyond the struggling PC market has involved a difficult shift in company culture but is well under way.

Lisa Su, AMD's Senior Vice President and General Manager of Global Business Units, told Reuters at the Consumer Electronics show in Las Vegas that veteran engineers who for years have specialized in designing PC chips based on Intel's "x86" architecture are warming to new ways of doing things.

Su joined AMD as part of a new management team hired by CEO Rory Read, who came from PC maker Lenovo in 2011 promising to make the chipmaker more efficient.

She previously worked on embedded chips at Freescale Semiconductor and IBM, and she has been described on Wall Street and in Silicon Valley as one of AMD's most promising executives.

Su said her lack of experience in PCs, the source of 80 percent of AMD's business, has been an asset in developing new strategy.

"I'm a big believer in using the best IP for a given application. It's because I'm not a long-time AMDer," Su said.

"There is a mentality that if you're a long time AMDer that we're x86, we know what we're doing and it's just about building better x86 devices," she said. "Much of the transition over the past year is that now we're a system-on-a-hip company. That's the future and we'll deliver the best technology for our growth markets."

A system on a chip, or SoC, is a chip that integrates several features found in a computer into a single piece of silicon.

Like top chipmaker Intel, Sunnyvale, California-based AMD was caught flat-footed in recent years with the emergence and fast growth of mobile devices, which led to an unexpected slump in the PC industry.

But while Intel has deep pockets to fund research on new products to catch up, AMD faces declining cash flows and a more modest balance sheet.

One of Silicon Valley's oldest chipmakers, AMD has laid off engineers and some analysts are concerned it may not find new markets for its chips in time to reverse a declining cash reserve.

"We spent a couple of months in the summer as the PC market was taking its very tumultuous reset as a team thinking, what do we want to be when we grow up? It was very much an introspective period of time," Su said.

The result was AMD's plan to double down on new markets like communications, servers and digital signs, and Su is seen as a key executive to lead that transition.

In October, Read told analysts on a conference call he had underestimated the speed of change in the PC industry and said AMD would move quickly to focus on selling chips for communications, industrial and gaming applications.

AMD recently announced it has licensed technology from Britain's ARM Holdings and will use it to build low-power chips for servers.

Su said AMD's relationship would grow over time.

(Reporting By Noel Randewich; Editing by Bernard Orr)

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