AMD is reshuffling its corporate deck following the abrupt resignation of CEO Dirk Meyer.
Indeed, a “CEO Search Committee” has already been formed to begin the rather tedious process of finding a new chief executive officer.
In the meantime, CFO Thomas Seifert will assume the position of interim CEO.
”Dirk became CEO during difficult times. He successfully stabilized AMD while simultaneously concluding strategic initiatives including the launch of GlobalFoundries, the successful settlement of our litigation with Intel and delivering Fusion APUs to the market,” explained Bruce Claflin, Chairman of AMD’s Board of Directors.
“However, the Board believes we have the opportunity to create increased shareholder value over time. This will require the company to have significant growth, establish market leadership and generate superior financial returns. We believe a change in leadership at this time will accelerate the company’s ability to accomplish these objectives.”
Of course, that is AMD’s official explanation, which does little to explain the reasons behind Meyer’s surprise departure.
As analyst Kevin Krewell of the Linley Group notes, there was no indication that Meyer was “in trouble” with the board. ”There hasn’t been any buzz that Dirk’s job was in trouble,” Krewell told MarketWatch.
“This is [certainly] very, very abrupt.”
Deutsche Bank analyst Ross Seymore expressed similar sentiments, saying that the “lack of details behind this resignation as well as its abruptness comes as a surprise to the market and will, in our view, be viewed in a negative light until further details are provided.”
But FBR Capital’s Craig Berger hypothesized that AMD’s “lack of a tablet chip,” server loss share of Intel and continued delay in Fusion products may have contributed to Meyer’s resignation.
“It is possible the board’s position is that AMD is behind in mobile computing and has poorly executed in server and Fusion.
“If so, we think the board wants to ‘have its cake and eat it, too,’ as it expects AMD to generate growing and material cash flow while also investing meaningfully in necessary R&D efforts.
“[Still], without a leader or clear strategic vision, [AMD] shares will likely move lower until some clarity is achieved. All things being equal, we could become constructive on AMD shares near $6.”
(Via AMD and MarketWatch)