AMD CEO Says Dell Partnership Moving Ahead

Advanced Micro Devices Chairman and CEO Hector Ruiz said he's rooting for Dell to resolve its financial problems and that Dell Chairman and CEO Michael Dell has given him no indication that the PC giant will back off its strategy to use AMD chips throughout its product lineup.

Speaking in an interview with CRN, Ruiz also said AMD will continue to pursue options for raising operating cash. However, he declined to comment on an analyst's report last week that said the Sunnyvale, Calif., chip maker would need to seek a cash infusion from capital markets by this summer.

"Even if I was thinking of doing something, I can't comment," Ruiz told CRN. "We've been very open about things we're doing to raise cash," including selling part of AMD's ownership stake in its Spansion memory products venture and putting its outdated fabrication plants up for sale, he said.

AMD executives have said the company, which had $1.5 billion in cash on the books at the close of its last quarter, would see a cash flow this year of negative $500 million. AMD has told the market that it expects to spend $2.5 billion in building up its fabrication and manufacturing infrastructure as it works to take market share from rival Intel.

Some industry observers speculate that Dell -- one of AMD's biggest and newest customers -- may be rethinking its relationship with the processor vendor. Last year, Dell agreed to begin making notebooks, desktop PCs and servers with AMD processors for the first time. That deal, though, was struck when Dell's CEO was Kevin Rollins, who resigned under pressure last month. Dell has been suffering through declining revenue and profit, loss of market share and two federal investigations into its finances.

Ruiz said Dell hasn't given him any signs that it might back off from its commitment to use AMD chips.

"I cannot speak for Dell," Ruiz said. "I think the plan that we have with Dell has been worked on for quite a long period of time. Michael [Dell] himself was very intimate in the discussions, in all the negotiations. I have had no conversations with Michael that led me to believe there is anything different at the moment.

"We're rooting for them," Ruiz said of Dell. "They are going through a transformation of the company. They are a partner, and we are going to do everything we can do to help them to compete."