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AMD's sales chief to leave company

The departure of Henri Richard, the primary sales executive, comes as the chipmaker prepares to release a key new processor.

Henri Richard, head of Advanced Micro Devices' sales and marketing, will step down from his post in September, the company officially announced late Wednesday.

"After 20 years in the PC industry--and five of the most professionally rewarding years here at AMD--I have decided to make a move to a different business segment," Richard said in a press release. He could not be reached directly for comment on his future plans.

AMD characterized the move as coming on "completely amicable terms," although the company appeared to be caught a little flat-footed by the news. The departure was first reported by Hexus.net and confirmed earlier Wednesday by CNET News.com.

Hard OCP published an internal AMD memo--which appeared accurate to an AMD representative--from CEO Hector Ruiz, announcing Richard's departure to employees and thanking him for his service. "When Henri joined AMD in 2002, his primary mission was to establish a world-class global Sales and Marketing organization. It is safe to say that he has accomplished that mission, and he is now ready for a new challenge in his career," Ruiz wrote.

Richard's departure may be leaving AMD in a short-term management lurch during a difficult time for the company. Last month saw the departure of Dave Orton, the head of AMD's graphics business following the chipmaker's acquisition of ATI Technologies. Ruiz said AMD hasn't developed a leadership plan yet for Richard's replacement, although his organization will now report directly to the office of the CEO, which consists of Ruiz and President and Chief Operating Officer Dirk Meyer.

Henri Richard Henri Richard

An AMD representative would say only that Richard is planning to leave in September, right as AMD prepares to launch Barcelona, its quad-core server processor, which has been beset by delays and glitches.

AMD could not confirm whether Richard will be present on September 10 for what the company is billing as "the most anticipated premiere of 2007." He had been expected to take part in a series of Barcelona launch events from Europe, but it is uncertain whether he'll continue with those plans. Ruiz will be present at the San Francisco launch event.

Richard came to AMD in 2002 after a stint at WebGain, a Java software company. He was previously at Bell Microproducts and IBM in a variety of sales and marketing roles.

Trouble in Barcelona
Richard's loss is a very significant development in what has been a disastrous year for AMD. Ruiz confirmed speculation that Barcelona is very late--six months later than expected--after the company encountered technical glitches. AMD has lost a ton of money in the interim, trying to compete against Intel's quad-core chips by slashing the prices of its dual-core chips.

Richard has been a very public figure at AMD, where Ruiz and Meyer are much less visible. He tends to field questions far more often than Ruiz or Meyer, most recently heading the AMD press delegation after its July analyst meeting.

More significantly, he oversaw AMD's rise from a company focused mainly on small niche suppliers to a company that counts the world's largest PC and server companies among its customers. "He made a very significant contribution when you look at how much AMD has changed," said Dean McCarron, principal analyst with Mercury Research.

But the past year has seen AMD give back some of those gains. Serious problems with its channel distribution strategy forced AMD to write off significant amounts of inventory and damaged its relationship with channel partners, who seem to think AMD had forgotten them while wooing the big boys such as Dell and Hewlett-Packard.

Despite AMD's characterization of his departure, the question must be asked: Is Richard the fall guy for AMD's problems? It's not easy to assess. Clearly, AMD has underperformed during the last year or so by anyone's standards, and there's plenty of blame to spread around.

Richard's blunt, aggressive style was an accurate reflection of AMD's confidence in 2005 and the first half of 2006, when it had superior products and was gaining on Intel. But after Intel's Core processor launches during the summer of 2006, Richard's aggressive tone started to ring false as AMD began to relinquish its market share gains and faced hard questions about its decision-making process regarding Barcelona.

The timing of Richard's departure does seem curious, given the pending launch of Barcelona. He would have undoubtedly played a major role during that event and in the subsequent months afterward as AMD tried to hit back against Intel.

There's a sense that AMD might require some changes to its manufacturing methods, known vaguely as "asset-light," that might be easier for a new executive to implement, rather than one who has been around for some time. And if Richard received an offer to run a company, he wouldn't be the first executive to make a career-oriented decision and escape a difficult situation. Now a new executive will have to face the grindstone of figuring out how to sell Barcelona against Intel's current quad-core chips and its forthcoming Penryn processors.

Regardless of the circumstances of his departure, Richard leaves AMD a better place than he found it, McCarron said. "They stopped being a small player, and they stopped acting like a small player, during his time frame," he said.