Good morning, ladies and gentlemen. I'm John Caldwell, AMD's Chairman of the Board, and I'll chair today's stockholders meeting. I now call the meeting to order and welcome you to AMD's 2018 annual general meeting of stockholders. I'd also like to welcome stockholders attending our virtual meeting, which is streaming live online now. We want to make our meeting as accessible as possible to stockholders. We're pleased to provide you the opportunity to vote and ask questions either here in person or via the internet. I'd like now to introduce to you my fellow board members and director nominees who are here with us today. Let me start with our President Chief Executive, Lisa Su, Director. Ms. Nora Denzel, Director and Chairman of our Compensation and Leadership Resources Committee. Mr. Nick Donofrio, standing at the back, Director and Chair of the Innovation and Technology Committee. Mr. Mark Durcan, Director.
Mr. Joseph Householder, Director and Chair of our Audit and Finance Committee. Mr. John Marren, Director. Mr. Abhi Talwalkar, Director. Mr. Ahmed Yahia, Director. Before continuing, I'd like to recognize Nick Donofrio, who having served on our board since 2009, is not standing for reelection as he's retiring from the board effective today. Nick is an icon in the technology industry, and he's made an outstanding contribution to our board and to AMD. On behalf of the stockholders and our board, I'd like to recognize and thank Nick for his tremendous contribution over your nine years. Thank you, Nick. Let me now introduce our Senior Vice President, Chief Financial Officer, and Treasurer, Mr. Devinder Kumar, and our Senior Vice President, General Counsel, and Secretary, Mr. Harry Wolin. This morning, we'll first take care of formal business of the meeting. Dr. Su will provide her report.
We'll also provide time for any questions you may have of our directors and officers. In addition, representatives of Ernst & Young LLP, our independent auditors, are here with us today and also available to answer your questions. I now call this meeting to order. As chairman, I designate Mr. Harry Wolin as Secretary of the meeting. Mr. Wolin will now conduct the formal portion of our meeting.
Good morning. As set forth in the notice of the meeting, the official business to be conducted is as follows. First, to elect the nine director nominees named in our proxy statement. Second, to ratify the appointment of Ernst & Young LLP as our independent registered accounting firm for the current fiscal year. Third, to approve an amendment to our amended and restated certificate of incorporation to increase the number of authorized shares of common stock from 1.5 billion shares to 2.25 billion shares. Fourth, to approve on a non-binding advisory basis the executive compensation of our named executive officers. Finally, to transact any other business that may properly come before this meeting or any adjournment or postponement thereof. Following the formal business of the meeting, the meeting will be concluded. Dr. Su will deliver her report as President and Chief Executive Officer of the company.
A stockholder Q&A session will follow her report. I would like to point out that management may be making forward-looking statements about the company's current plans and expectations. Actual results may differ materially from current plans and expectations, I encourage you to review our SEC filings where we discuss the risks inherent to our business, and you will find particularly detailed discussions in our annual report on Form 10-K for the fiscal period ended December 30th, 2017. Please note that non-GAAP financial measures referenced during Dr. Su's report are reconciled to their most directly comparable GAAP financial measures in the slide deck hosted on our website at ir.amd.com. Finally, please hold your questions until after Dr. Su's report has been concluded. Now returning to the business of the meeting.
I've been authorized by the board of directors to appoint Ms. Chris Vico as Inspector of Elections for the meeting. Ms. Vico will determine the number of shares represented at this meeting, the validity of the proxies, the existence of a quorum, and the number of votes on all matters voted upon at this meeting. The board of directors fixed the close of business on March 5th, 2018, as the record date for the determination of stockholders entitled to notice of this meeting and entitled to vote at this meeting. I have a list of stockholders of the company from Computershare, our transfer agent, showing approximately 969,131,738 shares outstanding on the record date and entitled to vote at this meeting. The list has been kept at our headquarters here in Santa Clara for the last 10 days and is available here at the meeting for inspection by any stockholder.
I also have an affidavit certifying that proxy materials for this meeting were first mailed on March 19th, 2018, to all stockholders of record on March 5th, 2018. The affidavit is available for inspection at the registration desk by any stockholder who may wish to see it after the meeting. The count immediately before the commencement of this meeting of shares present in person or by proxy indicated that 773,984,954 shares of the company's voting stock were present, representing 79.86% of the outstanding shares of common stock as of March 5th, 2018. Based on this number, a quorum is present. It is now 9:07 A.M. Pacific Time, I declare the polls to be open. I expect the polls to close in approximately 10 minutes. Voting today will be online or by ballot, or proxy, or in person.
If there is anyone present who has their proxy or who wishes to change his or her vote or otherwise desire to vote at the meeting in person, you can do so right there at the table with Ms. Vico. If you need a ballot, please raise your hand and one will be brought to you. Any online participants who wish to vote at this meeting should do so by clicking the Vote Here button on your screen. The shares of any stockholder who has filed a proxy will be voted by the proxy holders in the manner specified on the proxy form. A copy of the minutes of the annual meeting of stockholders of Advanced Micro Devices held on April 26, 2017, is at the registration desk for inspection by any stockholder who wishes to do so. We will dispense with the reading of the minutes this morning.
The election of directors is the first item on the agenda. The slate of directors recommended by the board of directors is described in the 2018 proxy statement. The nine individuals who have been nominated for election are Mr. John E. Caldwell, Ms. Nora M. Denzel, Mr. Mark Durcan, Mr. Joseph A. Householder, Mr. Michael J. Inglis, Mr. John W. Marren, Dr. Lisa T. Su, Mr. Abhi Y. Talwalkar, Mr. Ahmed Yahia. The board of directors unanimously recommends that you vote for the election of each of these directors. I now declare the nominations closed. The second item is to ratify the appointment of Ernst & Young LLP as our independent registered public accounting firm for the current year.
The vote required to approve this proposal is the affirmative vote of a majority of the shares of common stock entitled to vote and represented in person or by proxy at this meeting. The board of directors unanimously recommends ratification. The third item is to approve an amendment to our amended and restated certificate of incorporation to increase the number of authorized shares of common stock from 1.5 billion shares to 2.25 billion shares. The vote required to approve this proposal is an affirmative vote of a majority of the outstanding shares of our common stock as of the record date. The board of directors unanimously recommends that you vote for this amendment.
The fourth item to approve on a non-binding advisory basis is the executive compensation of our named executive officers as disclosed in the 2018 proxy statement pursuant to the compensation disclosure rules of the Securities and Exchange Commission. The vote required to approve this proposal is the affirmative vote of a majority of the shares of common stock entitled to vote and represented in person or by proxy at this meeting. The board of directors unanimously recommends that you vote for this proposal. Has everybody had time to vote, as the polls are about to close? It is now 9:11 A.M. Pacific Time, and I declare that the polls be closed. Ms. Vico, could you please present the report of the Inspector of Elections?
Based on the preliminary results, each of the nominees for director has received the affirmative vote of a majority of votes cast, and the appointment of Ernst & Young as the company's independent registered public accounting firm has also received the affirmative vote of a majority of the shares of common stock entitled to vote and represented in person or by proxy at the meeting. The proposal regarding the amendment to the amended and restated certificate of incorporation to increase the number of authorized shares of common stock from 1.5 billion shares to 2.25 billion shares received the affirmative vote of a majority of the outstanding shares of the company's common stock as of the record date.
The proposal concerning the advisory vote on the compensation of named executive officers received the affirmative vote of a majority of the shares of common stock entitled to vote and represented in person or by proxy at this meeting.
Thank you, Ms. Vico. Based on the preliminary report of the Inspector of Elections, each of the nominees for director has been elected. The appointment of Ernst & Young LLP has been ratified. The proposal regarding the amendment to our amended and restated certificate of incorporation to increase the number of common stock shares from $1.5 billion to $2.25 billion has been approved. The proposal concerning the advisory vote on the compensation of the named executive officers has been approved. The final report of the Inspector of Elections will be on file for the stockholders of the company, and we will report the final results on a current report on Form 8-K with the Securities and Exchange Commission within four business days. On behalf of Mr. Caldwell, the formal portion of the meeting is now adjourned.
At this time, I'd like to turn the floor over to AMD's President and Chief Executive Officer, Dr. Lisa Su.
Good morning, thank you all for joining us here at our annual shareholders meeting, and for those of you who are joining on the web. I'd like to take this opportunity to give you a little bit of an update on what we've been doing at AMD and what our plans are for the future. First, our path has been, over the last several years, to really focus on a few key things. We are a high-performance technology company. It is a very exciting time to be in high-performance computing with a tremendous growth in the overall market. We are also a technology company focused on great products, our engineers are, every day, thinking about how do we build the next most innovative products.
We've set a set of ambitious goals of what we think we can accomplish in the industry. Our focus is clearly on ensuring that we have very consistent and focused execution over a number of generations. Taking a look at the market, high-performance computing is an incredibly exciting market right now. If you take a look at all of the key applications, whether you're talking about the cloud, or you're talking about gaming, or in medicine, or automotive, all of these require high-performance CPUs and high-performance GPUs, and these are the areas where we are very strong. This is a great market for us to be in. In terms of the applications that are driving the demand for more computing, on the consumer side, you can see that there's a tremendous demand for better experiences. Better visual experiences, better voice recognition, better facial recognition, VR, AR.
These all drive the need for more high-performance computing. On the infrastructure side, with all of the data that we're all generating, there's a tremendous need for more computing horsepower to analyze that data. Big data analytics, machine learning, high-performance computing, artificial intelligence, all of these applications require more CPUs and more GPUs, and this is why we're so excited about the technology in the market today. Turning a little bit to AMD. In 2017, we had a very strong year. It really was a culmination of our long-term strategy to put great products together and introduce them into the market. We delivered a record number of products in 2017 across our PC market, our immersive and gaming market, as well as our data center market. It was practically the most productive year we've had from a product standpoint in the last decade.
That also translated into strong financial performance for 2017. For the calendar year 2017, we grew revenue 25%, actually over $1 billion of revenue, based on our new product introductions. We expanded our gross margins because part of our strategy is to ensure that we address a larger portion of the market, particularly the higher performance, higher ASP portions of the market. We improved our earnings per share, as well as we were profitable for the full year. These were key objectives that we had as a company, and we feel good about our accomplishments in 2017. As we look at AMD, I think we have really transitioned to a much broader customer set than the historical AMD customer set.
Starting first with our traditional customers around PCs and gaming, we are in all of the largest brands in the industry, including Apple, HP, Lenovo, Dell, Microsoft, Sony. What you see is that we're not only partnering with these customers, but we're also broadening our portfolio with these customers. You'll see more and more platforms coming from our top customers as we go into 2018. We also have a strong focus on the data center business and really expanding our enterprise footprint. In addition to the traditional customers that we serve in PC and gaming, we've also added a number of the most influential cloud and enterprise customers as users of AMD CPUs and GPUs, including Amazon, Baidu, Microsoft, Tencent, Google. These are all very important partners for us as we transition into the high-performance computing market in the data center.
The message is, we have strong customer momentum, and we'll continue to make this a key tenet of our business strategy. Talking about each of our businesses. In the Computing and Graphics business, we had a very strong roadmap and very strong product engagement. Our Ryzen product line has been very successful in a number of different areas. We introduced a full product line from Ryzen 3, 5, 7, and Ryzen Threadripper, really with price points from $99-$999. We've really introduced the entire footprint. We saw significant adoption of our processors in the desktop channel in particular. In some of the top e-tailers, we saw ourselves at 40%-50% share in those top e-tailers. We also have expanded our portfolio to include commercial clients. Our Ryzen PRO product line, very important in both desktop and notebook, as well as our Ryzen mobile APUs.
We saw in 2017, 54% annual growth of this business, and we believe this is really just the beginning of what we can do in the PC market. Moving over to the graphics portion of our business. Graphics is a very exciting portion of the market right now. There's a tremendous demand, whether you're talking about gaming or professional graphics applications. We introduced our Radeon RX Vega GPUs in 2017, and they saw a very strong reception in the marketplace. Radeon Pro Vega GPUs were adopted by Apple in their highest-end iMac Pro lineup. We also introduced Radeon Instinct into the professional and data center market, and we saw strong growth in that part of our business. We've also invested significantly in software because as we look at what's important, we want to make sure that our products are as easy to use as possible.
The software investment in gaming drivers as well as in machine learning frameworks are very important for us. On the enterprise, embedded, and semi-custom side, we introduced our new EPYC brand of CPUs. We're very excited about the data center market. We see it as a significant growth vector for us over the next couple of years. We have seen EPYC adopted by the top OEMs as well as a number of the Super Seven cloud providers, and we will continue that ramp here into 2018 as more and more customers adopt our solutions in key workloads like high-performance computing, like big data, like virtual machines. We also grew our embedded business. Very good business for us. Our semi-custom business continues to be solid.
We are in the sixth generation of the console cycle, and as a result, we do see some reduction in units, but overall, a solid business for us. The enterprise space will continue to be a large focus for us as we go into 2018. I'd also like to comment that from an AMD standpoint, we also believe that it's important for us to be a responsible corporate citizen, and so we've won several awards that we're proud of in terms of our ability to work with the community on important issues overall. Let me turn to 2018. We announced our first quarter results last week for 2018, and we started the year strong. We grew revenue 40% year-over-year. We saw a significant increase in our Ryzen CPUs as a proportion of our client business.
In the first quarter of 2018, Ryzen was 60% of our overall client revenue. It will continue to ramp as we go through the next three quarters. We also introduced our next generation Ryzen, the second generation Ryzen CPU. It got very strong reviews. We have even improved on the first generation Ryzen from both a gaming performance standpoint as well as an overall multi-threaded capability. We're very pleased with those early introductions for Ryzen in 2018. We also saw very strong demand for our graphics products across both gaming and blockchain. We continue to believe that graphics is a strong growth vector. We have over 40 platforms running with our EPYC CPUs, and we have a number of end users that are adopting our EPYC CPUs.
We also announced that we had our first silicon of seven nanometer. Our first graphics seven-nanometer GPU is now running in the labs, and the silicon looks very good. We're very pleased with how seven nanometer is coming up for us. I'd like to talk a little bit about our long-term roadmap. I think our commitment to our customers and to the industry is to continue a strong technology leadership roadmap. We introduced Zen last year in the Ryzen and EPYC families. Earlier this month, we introduced the 12 nm version of Zen+ in the second generation Ryzen products, and as I said, that received good reception. I'm happy to report that Zen 2, the design is complete, and that is our seven nanometer design on the CPU side.
We are improving our products in multiple dimensions, and we're very excited about that product. We're also on track with Zen 3. We have multiple design generations that are working on ensuring that we have a strong roadmap over the next five years for our customers, given how important the roadmap is in these markets. Also on the graphic side, again, a lot of significant focus on graphics. On the Vega standpoint, we introduced Vega last year in 14 nm. As I reported earlier, our seven nanometer Vega design is now complete, and we have good initial results. We have a very aggressive roadmap with our Navi generation that will be next in seven nanometer, and we'll move to 7nm+. Again, same message as the CPU side.
We're committed to a very strong five-year roadmap across both our CPU and GPU IP for our customers. On the data center side, this is a major focus for AMD. We introduced EPYC in the Naples product line. We are, with Zen 2, going to introduce the next generation Rome products for our customers. We have the third generation with Milan as well. Especially in the data center, I think we're building very strong relationships across the ecosystem, optimizing to AMD's architecture. With that, let me conclude and say thank you for all the support of our shareholders. I think we're very excited with where we are in our business, as well as in our products. I think the excitement is high performance computing is truly a growing and very important market for us.
We see, over the next couple of years, a $75 billion opportunity in high performance computing. Across PC, servers, consoles, graphics, embedded, automotive, machine learning, all of these give us a tremendous opportunity, and they all require high performance CPUs and high performance GPUs. As a company, we're very focused on delivering these product roadmaps and delivering consistent, sustainable revenue growth, as well as profit generation with these opportunities. Thank you very much for your support, and I think at this point, we'll open it up for questions for myself and also anyone on the board. Thank you.
If you would like to ask a question, there is a microphone in the center of the room, and I also have a few more online for you, Lisa, when we're ready to start.
Okay.
Our first question, because you were just speaking about Ryzen. Following the Ryzen announcements that you just mentioned for 2017 and Q1 2018, Ryzen appears to be doing well. What are the plans for additional products that we would see roll out beginning in Q2 and going forward?
Absolutely. Jim Anderson's here. We're very excited with our Ryzen portfolio. I think we've made great progress in Ryzen in the desktop space. 2018 is really the year of the notebook ramp for us, as well as the commercial ramp. We expect to have 25 new platforms launch here in the second quarter. You'll be seeing many of them in the e-tailer and retailer channels. We're also very close to launching our commercial offering in notebooks. For the first time in our history, you will have HP, Dell, and Lenovo launching commercial notebooks with AMD. We have a few more things that we plan in the second half of 2018.
I'd like to know if you can talk about the capital return to shareholders currently and maybe future plans there.
Yes, sure. I think from an overall balance sheet standpoint, we have certainly strengthened our balance sheet over the last few years. We have a strategy to, one, ensure that we invest in our business, and so we are investing in R&D. We also are reducing debt as we generate cash, and then we'll look at other opportunities as we go forward. Devinder, did you want to add to that, or?
No, I'm good.
Good. Yes, please.
Good morning, everybody. My name's Debra, longtime investor. The concern question is, last year I was at the shareholder meeting at your previous location. I think at that time was sitting at about 11 or 12. The last time I checked, 52 weeks high, 15.65, low is 9.04. It's not quite get to the initial when I purchased more than 10 years ago, like $14 purchase. I don't know what to do with this, I run into one of the investor told me, "You probably have to wait for another two years." Since last year, you guys have this new graphic product came out. Looks pretty promising. For some reason, I don't know if you got beaten by other company. I forget their company name. Drawing blank in here.
I was wondering why turnaround is going back down from the 1565 back down to about 1012. Yeah.
Thank you for the question. Thank you for joining us here today. Look, I think our goal as a management team, as a board, as a company, is to drive long-term shareholder value. Okay? That is absolutely our goal. I think when you look within a short period of time, there are ups and downs, and some of them are related to AMD, and others are related to sort of the overall economic factors. When we look at the foundation of the company, we are getting much, much stronger as a company. I feel very good about our progress. I think we're executing well on our products. I think that is showing in both top-line revenue growth as well as bottom-line profitability growth. We are going to continue to drive the foundation and the fundamentals of the company.
As I said, our goal is to drive long-term shareholder return. We're going to work very hard at doing that. Thank you. Yes, please.
I have a question about the GPP program that NVIDIA have. What do you guys think about it, and what is a future plan for that?
Yes. The question is about NVIDIA's GPP program. Look, I think our view is that anything that restricts competition in the marketplace is not a good thing. AMD is committed to an open ecosystem, committed to putting out high-performance products in the marketplace, and we are working closely with the ecosystem and our partners to ensure that you continue to have a very strong lineup from AMD across the board. Thank you.
Next question online, Lisa, is if you can explain the purpose of the share authorization increase that shareholders just voted on in favor of.
Yes. On the shareholder increase, we have no immediate plans for using those shares. It's been about 10 years since we've requested additional shares, from a governance standpoint, our board felt that it was the right time to ensure that we had authorization for additional shares. There's no immediate plans for usage of those shares, and anything that we would do would obviously have to be approved by the board at that particular time.
Do you know?
It's pretty obvious that you have strong leading-edge technology that's very competitive in the marketplace, my question is about the perception in the financial markets, which I follow closely. My words, AMD is always considered the poor man's Intel or the poor man's NVIDIA. What can you do to get your message out to show that you're more competitive with these companies? It's a consistent theme that I keep hearing.
Yes. I think the most important thing is, starting with the foundation of the business, is the product momentum. If you were to look across all sort of the independent reviews, whether you're talking about tech reviews in the PC business or in the server business, you'll see that the foundation of the products are very strong. We are absolutely, as I said earlier, focused on the overall shareholder return, and as a result of that, ensuring that the investment community similarly understands our progress in both from a revenue growth standpoint and a overall profitability standpoint. I think you should expect us to be aggressive in getting our message to the right places. It will take some time. There are still some people who wonder whether AMD will execute over multiple generations.
I can certainly tell you that this management team is very focused on executing over multiple generations. I think as we do that, people will continue to understand what our long-term strategy is, and that's our focus.
Lisa, what are the advantages of AMD's 7 nm strategy for CPUs, particularly in light of recent competitor comments about potential challenges at 10nm?
We see a very exciting opportunity with the 7 nm process node. We think the 7 nm process node coming from the leading foundries in the industry is very competitive. What we've seen is that the characteristics in terms of overall power, performance, area, will significantly enhance the current roadmap, and we're working aggressively on introducing our 7 nm products as soon as possible. I think there was one more question here.
Hi. I'm actually a new stockholder, I'm really glad to be here today. Looking at what your presentation was, it was great to see that you're focusing on ecosystems because hardware can't make it alone. Just really good to see that. My question is, going forward, focusing on long-term strategy, what is AMD's plan to differentiate itself from the graphics in Intel, of course?
Yes. I think AMD is in a very unique position from the standpoint that we have both leading edge CPU, x86 technology, as well as leading edge GPU across gaming and compute markets. Our differentiation is really around ensuring that, one, we have very strong performance capabilities, two, we have the ability to bring together. We believe the future data centers of the world are going to have a mix of technology. They're going to have CPUs, they're going to have GPUs, they're going to have some ASICs, they might have some FPGAs. I think the ability to look across that ecosystem from a system standpoint, on both the hardware and software standpoint, will be our long-term differentiator. As you said, software is very important.
When we look at the additional R&D investments that we're making in the company, they are heavily weighted towards software to, again, make our products easier for customers to adopt. Thank you.
Last question, Lisa, is about plans and what you see as the impact of potential blockchain and cryptocurrency on our business this year.
There is a lot of interest around blockchain and cryptocurrency. It is a new application that is using a lot of GPU horsepower. What we stated in our first quarter earnings call was about 10% of our revenue, approximately 10%, is blockchain or cryptocurrency related. As we go through the year, we see that there may be some moderation of that, and our forecast from an annual basis is that will be in the mid to high single-digits percentage of revenue devoted to blockchain and cryptocurrency. It's an interesting market that is a new market for us, but we see there's also a tremendous number of other growth opportunities for AMD. We've guided on a full-year basis that we believe we'll grow another mid-20s percentage overall revenue from 2017 to 2018.
We have a number of growth vectors across our Ryzen product line, our EPYC product line, our GPUs for gaming, GPUs for compute applications, and blockchain is one of those growth applications. Okay, very good. I think that brings us to the end. Thank you again for those who have joined us here in person and for those on the webcast. We really appreciate the support of AMD, and we will continue to look forward to updating you on our progress. Thank you.