UPDATED: AMD confirms fab business spin-off, then backtracks

— 6:00 AM on July 24, 2008

Say it ain't so. After months of rumors about the possibility of AMD spinning off its manufacturing business, AMD CEO Dirk Meyer has confirmed the move. Meyer made the revelation in an interview with the Austin American-Statesman, which printed the following:

And Meyer says the company is just months away from a major restructuring that will spin the manufacturing operations off into a separate company, wth new ownership.

Without the expensive manufacturing operations, AMD can concentrate on designing, marketing and selling chips that compete effectively against its two tough competitors - Intel Corp., the largest and richest company in the semiconductor industry, and Nvidia Corp., the foremost maker of graphics chips.

"Hector said he will be the most disappointed man on Earth if it is not done by the end of the year, and I will be the second most " disappointed, Meyer said. "It certainly needs to happen to remove this cloud over our head relative to the financial viability of the company."

That certainly doesn't seem open for interpretation. Nevertheless, The Inquirer says AMD has alleged that the Austin American-Statesman actually misquoted Meyer. Meyer supposedly discussed "radically transforming the way wafers are manufactured" while saying nothing about spinning off fabs.

Whether Meyer meant something else or AMD's PR department is attempting damage control, we might not have to wait much longer for an official announcement. Former CEO Hector Ruiz promised back in April that AMD would detail the specifics of a future, "asset-smart" strategy "in the near future." In any case, we've also asked the company to comment—stay tuned.

Update: AMD spokesman Gary Silcott has responded to our request with the following statement:

[I believe] the Austin American Statesman has already printed a correction regarding the misquote of Dirk Meyer, so even they are now admitting he never said what was attributed to him.

We've been pretty open that AMD is exploring a number of options for how we manufacture our wafers as part of our Asset Smart strategy. Hector Ruiz has also been very clear that we hope to announce progress on that front soon.

We weren't able to find the paper's correction, but it looks like AMD is sticking to its position that Meyer didn't announce the fab spin-off move. Whether that means AMD isn't considering or planning such a move is another story, though.

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