Good morning. I'm Andy Bryant, Chairman of the Board of Intel, and on behalf of the Board and our management team, I would like to welcome our stockholders and others who have joined us for our 2018 Annual Stockholder Meeting. On my right, I'm joined by Brian Krzanich, our CEO and Susie Giordano, Intel's Corporate Secretary. You will find today's meeting agenda on the portal. First, some logistics before proceeding with the business of the meeting.
Susie will conduct the formal portion of the meeting and record the minutes. After that, Brian will provide an Intel business update, and then we will address stockholder questions. As you all know, this is a virtual meeting where we invite all stockholders to participate, and also welcome non stockholders to view the meeting. In order to provide our stockholders the broadest opportunity to ask questions, we have had the stockholder question portal open since April 5. We will also take live questions during the meeting.
Any stockholder who would like to ask a question can do so by typing their question in the Ask a Question box and clicking submit. During the Q and A session, we will be answering both questions submitted to us prior to and during the meeting. As in our physical meeting, please limit yourself to one question. Please know that we are committed to answering your questions, and any questions that we are not able to address during the meeting due to time constraints will be answered on our website. I will now turn it over to Susie to begin the formal part of the meeting.
Thank you, Andy. Good morning. We have an affidavit from Broadridge certifying that the stockholders of record as of March 19, 2018, were mailed notice of meeting and proxy materials on April 5, 2018. The affidavit of mailing and notice will be filed with the minutes of this meeting. Ms.
Chris Fayko of the Fayko Group, who has taken her oath of office will be serving as Inspector of Elections for today's meeting. As of the record date, we had 4,700,000,000 shares outstanding that are available to vote. Mrs. Vico has confirmed that we have 87% of those shares by proxy, which constitutes a quorum. Therefore, the meaning is duly constituted and we may proceed with business.
Please be reminded that some of today's content, including Brian's business update, contain forward looking statements. All statements made during the annual meeting that are not historical facts are subject to a number of risks and uncertainties and actual results may differ materially. Please refer to our recent Q1 earnings release, our Form 10 Q and most recent Form 10 Q for more information on the risk factors that could cause actual results to differ. If we use any non GAAP financial measures during the presentation, you will find on our website intc.com the required reconciliation to the most directly comparable GAAP financial measure. The polls are now open for voting for those who have not voted.
The polls will remain open until the beginning of our CEO's presentation or 8:45 am, whichever is later. If you previously voted via the Internet, phone or mail, you do not need to take any additional action. If you previously voted and wish to change your vote, please do so before the closing of the polls by using the voting buttons on the portal. After the polls close, we will announce the preliminary results of the votes. Now I will turn it back over to Andy to introduce our directors.
Let me introduce the directors. We have I would now like to introduce our non executive board members who are joining us here at the studio or via the telephone. Anil Bushri, Co Founder and CEO of Workday Reid Hunt, Principal, REH Advisors Omar Ishrak, Chairman and CEO of Medtronic Doctor. Risa Lavizzo Mori, Professor at the University of Pennsylvania Doctor. Tsu Jae King Liu, Professor at the University of California, Berkeley David Patrick, Chairman and CEO of Redigo Ventures Greg Smith, CFO and Executive Vice President of Corporate Enterprise Performance and Strategy at Boeing Frank Gehry, Executive Chairman of Chemerview Partners.
The following 3 directors could not attend today's meeting: Ambassador Charlene Barshevsky, Senior International Partner, WilmerHale Andrew Wilson, CEO of Electronic Arts and David Jaffe, Professor, Harvard Business School. I now turn it back to Susie for the election of the directors.
Thanks, Andy. I'll turn to our first proposal, which is to elect 10 directors to Intel's Board. The nominees to the Board are Aneel Bhushri, Reade Hunt, Omar Ishrak, Brian Krzanich, Doctor. Risa Lavisio Mori, Doctor. Sujay King Liu, Greg Smith, Andrew Wilson, Frank Yurey and Andy Bryant.
Before we move to the next agenda item, we would like to recognize our retiring directors, Ambassador Charlene Barshevsky, David Potrick, Doctor. David Yaffe, who are retiring from our Board after the meeting today. On behalf of the entire Board and management team, I would like to thank our retiring directors for their combined 62 years of dedicated service. The second matter today is the ratification of the selection of Ernst and Young as Intel's independent auditors for 2018. Jeff Lang, a senior partner of our audit team from is here today and is available to answer questions during the Q and A session.
The 3rd item on the agenda is an advisory vote to approve executive compensation, also known as say on pay. We are asking stockholders to approve on an advisory basis the compensation of Intel's listed officers as described in detail in the proxy statement. And we have a long history of strong pay for performance alignment, and we believe that our compensation programs operate in the best interest of our stockholders. While this is an advisory vote to approve executive compensation, the Board and the compensation committee will carefully assess the voting results and will consult directly with stockholders to better understand any issues or concerns raised through the stockholder vote. The final agenda items today are votes on 3 stockholder proposals.
The first stockholder proposal was submitted by Mr. John Chevedden. Mr. Chevedden or his representative, Mr. McRitchie, will be presenting the proposal.
Mr. Chevedden or Mr. McRitchie, we would like to offer you 5 minutes to present your proposal.
Yes, this is John Chevedden. Can you hear me?
Yes, we can hear you fine. Thank you.
Okay. This is the proposal of shareholder right to act by written consent. Shareholders request that our Board of Directors take the steps necessary to permit written consent by shareholders entitled to cast a minimum number of votes that would be necessary to authorize the action at a meeting at which all shareholders entitled to vote thereon were present in voting. This written consent is to be consistent with giving shareholders the fullest power to act by written consent in accordance with applicable law. This includes the shareholder ability to initiate any appropriate topic for written consent.
This proposal won majority support at 13 major companies in a single year. This included 67% support at both Allied's Allstate and Sprint. 100 of major companies enable shareholder action by written consent. This proposal topic also won impressive 42% support at the Intel 2016 Annual Meeting, plus this 42% vote would have been still higher above 45% if small shareholders had the same access to corporate governance information as large shareholders and a greater number of small shareholders cast ballots. This proposal is important at Intel because Intel shareholders also do not have the full right to call a special meeting that's available under state law.
It is especially important to adopt a shareholder right to make management more accountable to shareholders like this proposal. To make up for our management taking away the important shareholder right, the right to an in person annual meeting. We do not have an opportunity to vote on giving up this important shareholder right. For decades, shareholders of U. S.
Companies had a once a year opportunity to ask a $20,000,000 CEO and directors questions in person. Now our directors can casually put their phones to mute during the entire meeting. Our management is now free to run a make believe meeting with Investor Relations devising softball questions in advance, while tossing out challenging shareholder questions. Then our $20,000,000 CEO can simply read the scripted Investor Relations answers to a microphone, no opportunity for live audience feedback. The lack of an in person annual meeting means that a Board meeting can be scheduled months after the virtual meeting, by which time any serious issues raised by shareholders under these adverse conditions will be long forgotten by the directors.
Plus a virtual meeting guarantees that there'll be no media coverage for the benefit of shareholders. A virtual meeting is complacency plan for our directors and top management. Top management has no incentive to avoid making mistakes for 365 days out of the year out of concern that there'll be an in person accounting at the annual meeting. Please vote yes, show the right deck by written consent to help make up for management taking away the right to an in person annual meeting. Thank you.
Thank you, Mr. Chevedden. We do recognize the importance of stockholder rights and based on a careful review of your proposal and the company's current corporate governance practices, which do include the right to call a special meeting, we believe the implementation of the proposal is unnecessary and actually contrary to the best interest of the stockholders. In the interest of time, I would please refer you to the 2018 proxy statement for the Board's views on this proposal. We appreciate you joining us today.
The second stockholder proposal was submitted by Ms. Myra Young. Ms. Young or her representative will be presenting the proposal. And we'd like to offer you 5 minutes to present your proposal.
Hi. This is Jim McRitchie presenting my wife's proposal number 5 on Independent Board Chairman. Shareholders request our Board of Directors amend our governing documents to require the Chairman of the Board of Directors, whenever possible, to be an independent member of the Board. The Board would have the discretion to phase in this policy for the next CEO transition implemented so it does not violate any existing agreement. It just doesn't make any sense to us that the CEO should be Chairman of the Board because the Board is the one who is primarily charged with evaluating the CEO and hiring a new CEO if necessary.
So why would you have the Chairman or the CEO be basically his own boss by also being the chair. It's Also important, I think I'd like to reiterate what Mr. Chibutin said with regard to this virtual only meeting, we all favor most shareholders favor hybrid meetings. We welcome the opportunity to be able to participate virtually. However, we think it's also very important to be able to attend in person.
As Mr. Shiverdin noted, we can't tell as virtual participants what questions are being asked, what questions are being thrown out, etcetera. And we think that a hybrid meeting would make directors much more accountable to shareholders. The Council of Institutional Investors, a coalition of funds with portfolios exceeding $3,000,000,000,000 as among its corporate governance guidelines for public company the following: Cyber meetings should only be a supplement to traditional in person shareholder meetings, not a substitute. Face to face annual meetings facilitate un silted dialogue between shareholders and management as well important opportunities to exchange ideas before and after the meeting.
So getting back to the main thrust, please vote to enhance the independence of our CEO and basically independence of our Chairman and vote yes on proposal 5.
Thank you, Mr. McRitchie. We recognize the importance of Board independence and I'd like to remind everyone that our CEO is not the Chairman of the Board. Our current structure actually includes a strong lead independent director and we believe that the implementation of the proposal is unnecessary and contrary to the best interest of stockholders. In the interest of time, please also refer to the 2018 Intel proxy statement for the Board's full views on this proposal.
We appreciate you joining us today. The last proposal is a stockholder proposal submitted by Northstar Asset Management Funded Pension Plan. Its representative, Ms. Marie Schwartzer, will be presenting the proposal. Ms.
Schwartzer, we'd like to offer you 5 minutes to present your proposal.
Thank you. Again, my name is Mari Schwartzer from Northstar Asset Management in Boston. Northstar is the beneficial owner of 79,040 shares of Intel common stock. I'm here to ask for shareholder support of Resolution Number 6 regarding a cost benefit analysis of political contributions related to our company. Each year, our company and its political action committee make contributions to hundreds of political candidates that support or try to defeat legislation that affects our companies and our employees.
Our company policies state that Intel reviews historical voting records and positions related to key strategic issues for Intel. However, my firm's research indicates that Intel may be limiting that review to the narrowest possible interpretation of key issues. For example, it is becoming ever clear that climate change is a crucial business issue, yet Intel has repeatedly provided financial support to many climate change deniers. These politicians pursue legislation that undermines actions taken by our company to do our part in limiting climate change. While Intel is moving forward to reduce its environmental impact, our PAC has contributed to candidates that have taken actions that may increase the risk of climate change such as voting to bar the EPA from regulating greenhouse gases.
Our 10 ks list climate change as a risk to our business, yet our PAC is supporting political candidates who purport that climate change doesn't even exist. Not only that, but Intel has been a long time advocate for our company's LGBT employees and their families and Intel has a focus on promoting women's rights and empowerment. Yet our PACS contribution record includes giving to various political candidates that have voted against bills that would end discrimination against LGBT people and against the Violence Against Women Act. Again, when Intel is moving forward on these critical human rights issues, our PACS contributions may effectively negate that work. Or worse, these contributions may pose a risk to the company if we lose key LGBT or female employees due to discriminatory laws, especially if our political contributions to candidates aided in the passing of those laws.
I have yet another example. Intel states that a legislative solution is needed to legalize the status of beneficiaries under the Deferred Action for Childhood Arrivals program known as DACA, who have known only one home in the U. S. However, our PAC has contributed to politicians like Bob Goodlat who consider the DACA program to be unlawful. Furthermore, Intel supports immigration reform and relies on highly skilled international applicants.
However, our PAC has contributed to Darryl Issa, the primary sponsor of the Protect and Grow American Jobs Act, an act which is specifically intended to bring problematic changes to the H-1B visa process that our company relies upon to bring the best and brightest international employees to our company. Political contributions, especially those that are misaligned, may bring risk to our company. An example of this came less than a week ago when AT and T and Novartis came under fire after media sources reported that both companies paid large sums of money to Michael Cohen, President Trump's lawyer and so called fix it guy. Our proposal today offers an opportunity for shareholders to gain confidence that our company's oversight procedures of political contributions are robust and protective of shareholder value. How can shareholders be confident that our company is diligently and thoroughly reviewing voting records on all key issues when it appears that the decision makers at our company have failed to consider the gravity of issues such as climate change, women's rights, immigration reform, visa issues and LGBT rights when making political contributions.
We as shareholders need to know that the potential risks and costs of political contributions have been accounted for when management has also calculated the potential benefits and gains. For these reasons, fellow shareholders, we ask for your support of Resolution 6. Thank you.
Thank you, Ms. Schwartzer. We do take the issue of political accountability seriously and are committed to transparency around our contributions disclosure. In the interest of time, though, please refer to the 2018 proxy statement for the Board's views on this proposal. We appreciate you joining us today.
Because it is now past 8:45 am, the polls are now closed. Next, Brian will present a business update.
Okay. Thank you very much, Susie. And it's just really a great honor to be here this morning with everybody. This is my 5th Annual Shareholder Meeting. And this morning what I'd like to do is really talk about 3 things.
Go over our 2017 results. 2nd, give you some insight into our strategy, which is really we've labeled it as a data centric strategy, a view that data is really going to drive the technology and the ecosystem that Intel is going to work within. And 3rd, I thought it would be good as this is my 5th year to give a 5 year report card and really show you what have we accomplished in the 5 years that I've been the CEO of Intel. So let's get right into it, 2017 results. 2017 was truly a record year and I'm really proud of everything the organization has accomplished.
Revenue was at 62.8 $1,000,000,000 which was up 9% year over year, excluding McAfee, which we divested in 2017. We had record DCG revenue in our data center group at $19,100,000,000 We had record IoT revenue at $3,200,000,000 Our memory group NSG grew its revenue to $3,500,000,000 Our operating margin was 31%, up 3 points year over year. And our earnings per share was at $3.46 up 28% year over year. And if you really take a look at that in all of its measurements, it was really just a fantastic year by the organization. In Q4 alone, if you just took a look at our what we call our data centric revenue, which is our data centric group, our FPGA organization, our IoT organization, our memory organization, everything that is outside the PC and really focused on that data centric world, it was up 21% year over year, which again shows us that where we're pointing the company, where we're heading is truly growing at the kind of rate that we really want to have.
So if you take a look at that, we've now grown this area outside the PC for this corporation at to nearly 50% of our revenue, which is exactly where we wanted to be by this timeframe. So let's talk about some of the other things we've done this year. From a mergers and acquisition activity, Mobileye was one of our most strategic acquisitions we've made in quite a while now. If you remember prior to this, we did the Alterra acquisition. In 2017, we purchased Mobileye.
And this is really focused on autonomous driving and really driving a scalable platform that is cost effective and includes a very different approach for how you take a safety first, safety centered approach to autonomous driving. We now have these cars driving on the streets and you will continue to see more and more of the cars driving and partners signing up for Mobileye technology to carry us forward in the autonomous driving marketplace. The other action that we did in 2017 was the divestiture of McAfee. McAfee, we had done a great job, I believe, of really honing the organization, focusing it on profitability and growth. But we didn't see the connection to our data centric strategy.
And so we thought it would be better off for both McAfee and Intel if we separated the organization. And so we divested the McAfee assets in a partnership with TPG. And it's really gone great. And if you take a look at it, we continue to see that this will be a good strategic direction for the company moving forward and a good strategic direction for McAfee. We continue to participate in McAfee, but not be the driver of the technology and the strategy for McAfee moving forward.
So let's take a deeper look into that strategy. What do we mean when we say data centric strategy? And what does that really mean for the company? And our strategy is that it's really pretty simple that data is going to become the fuel of most of the technology revolutions that we see. And it's really driving where technology is centered around.
And our strategy is to provide the technology foundation for this data centric world. And so we take a look at it from this foil from a couple of points of view. And on the right hand side, what you see there is what we call this virtual cycle of data, where you really have in the center accelerating technologies and people you hear about these, they're technologies that are driving artificial intelligence, they're driving big data applications, They're driving video analytics. And that is then connected to things that are out at the edge. These can be video cameras.
They could be autonomous cars. They could be sensors in your home or in your business. Those collect data and then push those up into the cloud. And the cloud is unique in that what it does is it is able to aggregate data from many, many locations. So it's not just from my house, but many houses.
It's not just from my autonomous car, but from many autonomous cars. And it can keep that data also even from my devices, my car, my house or whatever, for a long period of time. And it's in that cloud that we can apply these analytics across larger data sets. And those analytics then think of them as big data applications or artificial intelligence allow us to create new experiences. And it makes the autonomous car smarter because it's able to collect information from many cars about road conditions.
It's able to look at my house and my behaviors house over time and adjust thermostats and lighting and things like that with some intelligence. And those create these new experiences. And so when we look at this, we say, okay, if this is the world that we're going to work within and the ecosystem that we're playing within, what do we need to do? And that's kind of on the left hand side. The first is make the world's best semiconductors because that's really going to be the engine behind this data centric world.
The second thing is be the leading end to end platform provider. You need to really think of these now as a larger scalable platform. You can't think of just selling a single piece of silicon into a data center anymore or into an autonomous car. You really have to think about it from end to end. You have to think about the sensors that are going in the car, the computing behind that, the modem that's connecting it, the edge clouds that are out there in the cities.
All of this has to be thought of as a platform. And then the last thing is lead in the artificial intelligence and autonomous revolution. Data that is just sitting there in the cloud still doesn't have much value. It's when you apply analytics, it's when you apply artificial intelligence and when that leads to this revolution of capability and experiences of which autonomous is just one example. But you really need to do apply that computing to those data sets in order to really bring the value out of them.
And if we do that and as we do that, we believe we can deliver the best customer experiences on the planet. And that is what's going to fuel the growth engine of Intel. I wanted to give an update because we talked about this at our earnings call and I know for shareholders it's a key portion of this. It was a 10 nanometer update. Today, it's shipping in low volume, and you can find it in various sources out there.
We talked about at the earnings call that the yields on this product haven't come up as quickly as we wanted to. And our goal is to really deliver this cost effective high yielding 10 nanometer parts. So what we've said is we're going to slow the ramp down of 10 nanometers. We're able because of the great strength of our 14 nanometer technology continue that innovation to drive cost effective, high yielding, high performance parts that still provide the best performance out there. And while we go and continue to develop and improve the yields on 10 nanometer.
We believe we have the technology issues understood and we think we know how to now progress forward and deliver the 10 nanometer yields as we move into 2019. So that is really our 10 nanometer update. I thought I would now go and give you a report card. As a shareholder, I think it's important that you are able to see what my performance has been and the organization this performance has been as far as delivering value to you back as a shareholder. And so a report card is the best way I could think of doing it as we kind of gathered together here this morning.
What I'm going to take a look at is our revenue, our earnings per share, our shareholder return, how we think about TAM and how has that changed our total available market that we're trying to address. And then I wanted to spend a little bit about diversity inclusion because that's been another key theme that the company is really focused on. So let's start with a report card on revenue. And I think as you take a look at this, it's nothing but stunning in my opinion what the organization has done. If I take a look in 2013 when we started this, 2 thirds of the revenue was from PCs, 1 third of it was from what we would call the classic data centric business of today.
If you take a look at it, we've been flat for several years, maybe even slightly down in revenue. And we, during 2013, started to put this data centric strategy together and shifting the investments, shifting the investments to IoT, shifting the investments to the data center, driving the product portfolio that has really shifted to those areas as well. What we've done as a result is shifted from a flat revenue profile to about a 4.5% compound audio growth rate of revenue and really growing those data centric areas at about 12% for the entirety of that time. And you can see as we've gone through here now in 2017, we've had both top line growth, but also a shift in where that top line growth has come to this data centric area. So that's the top line growth, but I know that it's just as important to grow the bottom line.
And there again, the organization has performed quite well. Early on in the transformation, we focused on investments, but you see that we even within the 1st year, we started to make some improvements and grow the top line or excuse me, the bottom line with EPS growth from $2 to $2.50 We continue to make some pretty heavy time of time of investments, we've continued to be able to grow the earnings per share to where we're now at $3.46 We continue to expect that we could hold our spending to that 30% as a percent of revenue number. And we've achieved it with Bob Swan, our CFO's great effort and the organization's great effort 2 years earlier than we committed to. So I'm really proud of what the organization has been able to accomplish here. Now EPS growth has to have then be transformed into shareholder returns.
Over the last few years, we've paid out 84% of our free cash flow through buybacks and dividends over the last year and delivered roughly about $46,000,000,000 in value to our shareholders. We will continue to grow dividends in line with our non GAAP earnings and offset the dilution of any shares through opportunistic buybacks. Intel shareholder return has also grown 163 percent over the past 5 years, faster than 3 of the 4 indices shown below here. And we really feel like what we've done here is delivered good shareholder return, good shareholder growth. And we've also really built something that can be continue to deliver that growth and that return into the future.
In our acquisitions with things like Alterra and Mobileye will continue to help us do that in new areas as we continue to build out this data centric strategy. So the next part of the report that I thought we'd take a look at is just how does that mean we've grown our total available market or the TAM as it's often called. And if you looked at 2013, we kind of looked at it from, well, the majority of the business was the PC and we had a relatively small in comparison server CPU business. And so our total available TAM was about $45,000,000,000 And that's from a silicon TAM perspective. But by really shifting how we think about all of these areas, both from a PC perspective and using a segmentation process that allows us to really think about high end workstations different from high end gaming systems, different from low end entry PCs or thin and light laptops.
We are able to increase the TAM of just the PC and the adjacencies in those areas as well by over twofold. But we've added several others that now makes our total available market and how we look at where Intel can grow from $45,000,000,000 to $60,000,000,000 That's a much larger marketplace that we're going and focusing and trying to grow after. So I think that's an important view of what's the future lead. We look at this as this is our growth area for the future. And then the last area that I wanted to talk about very quickly was improving diversity and inclusion.
And that was a task the team wanted to really lead in as we went out and took on this task. And we wanted to show that in the tech industry, we could deliver results in diversity and inclusion. And we could do that in the way we do everything by really approaching it from an engineering perspective, which means you measure it, you sit and you on a regular basis think about the programs you're using to improve it just like you're improving a product. And you continue to measure it and you hold yourself accountable for delivering the results. I'm really proud of what the organization has done.
I put here a gap to full representation comparison from when we started, which was about 2,300 employees, both women and underrepresented minorities at all levels that we were deficient in at the different places. And we've now worked that down to less than 300. We've committed originally to close all of that gap by 2020. But given our progress and understanding exactly what we need to do to deliver the remaining portion, we've pulled that in now to saying we will deliver this by the end of this year or the end of 2018. And I'm just so proud of it and Intel is a different place and we've done this while growing the business, while growing profitability and it's a great example of how this actually we believe has improved our ability to deliver those results.
And we're getting better business results as a result of this diversity and inclusion effort. I think if you take a look at the staff that's delivered this, I'm really proud of everybody who's on this photo right now. And it also shows you that diversity and inclusion as these people not only represented, but they are the ones who have actually delivered it. And so I want to recognize this team as well. You can visit our website and take a look at all of these results and quite a bit more about Intel's corporate social responsibility.
This is our 17th Annual Corporate Responsibility Report. It outlines our goals and performance in the areas of environmental sustainability, supply chain, diversity and inclusion and our social impact efforts. I invite you to visit our website to read the new report and to learn more and share your feedback. We're always interested in learning how we could do better in these spaces. Finally, this is Intel's year to celebrate its 50th anniversary.
I want to give you a quick kind of sneak that I encourage you to look to the skies above our headquarters here in Santa Clara around July 18, which is the actual day of our 50th anniversary to celebrate with us as our anniversary approaches that week. So thank you very much for your time today. It's been a great honor to be your CEO. And I'll now turn it back over to Susie.
Thanks, Brian. We'll now proceed with the Q and A session where we answer previously submitted questions as well as questions submitted on the web during today's meeting. Brian, I'll actually turn it back to you to respond to the questions.
Okay. Okay. The first question is, what is Intel's strategy for leading in artificial intelligence? And what I'll tell you here is that we think about artificial intelligence as a broad spectrum of products and workloads. And you really need to think about artificial intelligence as not one thing anymore.
It's everything from artificial intelligence that's out at an edge camera that is able to do facial recognition and maybe detect who the person is at the door. Is it an employee or friend of yours, if it's your house or your business versus somebody that's unknown, is it somebody in your contact list. Those parts need good performance at very low powers and very low temperatures and operating temperatures. Then you go up through a variety of edge devices, autonomous cars, drones that are flying around, then you get into big industrial artificial intelligence, maybe operating robots inside of a factory. And then you eventually get up to the data center where you're applying it across huge data sets, maybe weather modeling or looking for patterns in manufacturing drugs, you need to be able to have products that span that continuum in order to really lead in artificial intelligence.
And at Intel, we believe that we are absolutely selecting most of those areas and building products that are leading edge and leading the industry. And then the last thing you need to understand is that in artificial intelligence, there's both training and there's inference. So basically, you have to train your models and then you actually have to apply your models in the field. And so what we've done is we've purchased some like Mobidius that is a low power, high performance. If you look at most of the autonomous small drones that do object avoidance and can recognize a tree or a wall, The smart cameras that are out there recognizing faces or license plates or other objects, they're often powered by Movidius devices.
You've seen our acquisition of Mobileye. That is really driven towards autonomous driving and the artificial intelligence of driving a car. Those are great acquisitions where we've bolstered certain segments of artificial intelligence for the corporation. Then you go up to things like FPGAs, which are kind of one of the next levels of artificial intelligence and you see that applied in some of the data centers. We recently announced a great relationship with Microsoft and our FPGAs there, developing artificial intelligence on the leading edge with Microsoft.
And then we go up to our Intel Xeon Scalable platform and eventually our Nirvana, which was another acquisition that's targeted right at the data center. And if you look at most of the artificial intelligence inference, which is actually the application of artificial intelligence, Xeon especially is the leader in performance around artificial intelligence in that segment. So we think about artificial intelligence across that spectrum and are developing products for all of those segments. Our next question is, will the challenges you had on 10 nanometers impact 7 nanometer execution? So I get that one again.
And the simple answer is most of the problems that we encountered on 10 nanometer will not impact 7 nanometer. And let me explain some of those. 1, 10 nanometer, we believe, will be the last technology that we try and develop without EUV. EUV is the next generation lithography tool. And if you understand semiconductor manufacturing, lithography or the printing of the lines is the critical step in producing the product at the next smaller geometry.
And we've been stuck without EUV for the longest period in the semiconductor industry history on a single type of lithography tool. And 7 nanometer will be the first one that transitions to the new lithography tool, which then opens up our ability to print features that are much, much smaller, much more easily. So that's step 1 that's different between 10 and 7 nanometers. The other thing is we went back, if you remember from the earnings call, I said that one of the things we did in 10 nanometers was took a much more aggressive scaling factor. We said instead of our typical 2.4, the industry actually goes between 1.5 and 2.
We went all the way up to 2.7 and that 2.7 is you can just think of it as 1 over 2.7 is kind of being how much smaller you're trying to make it, caused a lot more interaction with the geometries as we try and make them so much smaller. At 7 nanometers, we go back to our 2.4 as another example. So we've made changes like that to make 7 nanometer much more like our traditional technology innovations that we've done. And hence, we believe that most of the issues that occurred at 10 nanometers would not carry over into 7 nanometers. And we continue to monitor our progress on 7 nanometers and continue to be very positive about where we're at with 7 nanometers.
Okay. Next question. What are Intel's plans to improve female representation on the Board and on the executive team? So I'm going to start this question and kind of give you a broad overview. And then I've asked our Lead of the Nominating and Governance Committee, Frank Gehry to also comment on the Board's specific perspective.
I think it's good that you hear from an independent Director as well. So let me answer first a bigger picture of the company and also this carries into the Board. It just naturally does. Our clear objective is to get to full representation at all levels. And so we think of that from the very entry level employee through the highest level of the corporation.
And of course that carries over into the boardroom as well. And full representation means that we will have both female representation and underrepresented minority representation at every level in both technical and non technical areas. That 2,300 going down to less than 300 and saying that we will close that last 300 gap by the end of this year rather than the original commitment of 2020 is just that, getting that full representation of women at every level of the corporation to full representation. I want to also remind you that we've also and we published in our annual diversity report or biannual diversity report, excuse me, our pay ratio between women and men to make sure that women at equal job grades and typical roles are paid equally. And we think that's just as important to make sure that not only are women in representation, but they're being paid equally for the equivalent work.
And we've closed those gaps over the years as well. So I'm really proud of what the organization has delivered here. But let me hand it over to Frank Gehry to give you a comment about how the Board views us.
Thanks, Brian. Perhaps I'll start by saying the Board's committed to diversity among members and diversity of perspectives and thoughts at the Board. We think it helps us make better decisions and it's in the shareholders' best interests. It's true that we lost a terrific colleague with Charlene's resignation late last year. She's not standing for reelection.
But it's also true that we have had 2 of our more recent Board additions, including our most recent addition to the Board, have been very accomplished women. And I can say that both Riza and Sujay are great Board colleagues. Further, when we consider Board candidates, we always consider a diverse slate, a full slate that includes representation of women in the slate. And we will continue to do so.
Thank you, Frank. That was very helpful. Okay, let's go to the next question. With a CEO medium pay to employee ratio of 211 to 1, how does the compensation committee arrive at Brian's compensation? So I don't feel like I should answer that question.
So I'm going to hand it over to David Potruck, who is another independent board member who is here this morning and David also has been running our compensation committee. So with that, I'll hand it over to David.
Thank you, Brian. We believe that our executive compensation program demonstrates a very strong pay for performance alignment. With respect to Brian's pay, the committee follows a rigorous process in seeking to align his pay to the market for CEOs of comparable companies, supported by an independent compensation consultant who surveys the market. When Brian was first promoted to CEO, his pay was set at the 25th percentile to recognize his newness in the job. And over time, we've gradually increased his pay to reflect his growing experience in this role and to reflect the enormous achievements of company growth and performance as you've seen in Brian's recent presentation.
Brian's compensation today is at the median for CEOs of comparable companies that we survey each and every year. Now as it relates to pay ratio that are reported by other companies, this is really something that's very hard to compare from company to company as companies may have different employment and compensation practices and may utilize different methodologies in calculating their individual pay ratios. And you have to keep in mind that as a worldwide manufacturer, the makeup of our workforce can be very different than other technology companies who don't have global manufacturing and may therefore have a higher ratio and therefore we may have a higher ratio than large tech companies who employ a very high-tech workforce compared to our global manufacturing workforce.
Okay. Thank you, David for that answer. Okay. The next question is, does Brian's recent stock sale reflect his confidence in Intel's future? Well, I hope you saw in my 5 year report card and my strategic portion of my presentation just the great results that we have, my pride in what the organization has really delivered and my excitement at you really addressing that $260,000,000,000 TAM moving forward.
So I couldn't be more excited about Intel's future than I am now and I've been at this company for 35 plus years. I think our brightest days are ahead from our products the organization to just about everything about this company. So I can say absolutely the sale is not a reflection of all of my confidence in the company. Intel continues to be my largest single holding, and I continue to hold above the required level that the company has for me. So, no, this is my view of the company is stronger today than it ever has been in my 35 years here.
Okay. Next question. This is a question that's a live question from the web. What do you think about the escalating trade tension with China? Is Intel impacted by the tariff list?
Is a trade war with China a threat to Intel? So first what I'd tell you is China is an important market for Intel. It's one of our larger markets. It's our fastest growing market, growing typically double digits. And absolutely the company believes in free trade and free trade that's equal on every side.
So we believe that continued trade with China and continued good relationships and partnerships with China is important. Clearly, if there was a trade war or additional tariffs, it would be a risk. We've listed that as a risk in our risks portion of our information. And currently, we are, as you've talked about, not impacted in any kind of a material way by any of the actions that have been taken so far. So continue to be focused on China.
It's a great market for us. We have great relationships inside there. We believe though in free trade that's equal on both sides. And we want to continue to see the two sides working together moving forward. Okay.
Let's see what the next question is. Regarding proposal 2, auditor fees increased 15.5 percent from 2016 to 2017. Please tell us why. Also please estimate the fees for 2018 and explain the need for any increase. Thank you.
I'm going to ask Frank Urie again, who has been on our audit committee and continues to participate in audit committee. He was prior audit committee lead. And as I said, it's now the lead of the nominating governance committee to give you an independent view on that question.
Thanks, Brian. As you heard in Brian's presentation, Intel successfully divested 51% of Intel Security Group, also known as McAfee in the first half of twenty seventeen. In connection with that successful divestiture, it was necessary to prepare standalone financial statements. And the principal and primary reason for the increase in fees between 2016 2017 was the work associated with that divestiture and the creation of those standalone financials. As to 2018, barring any extraordinary or unusual items of similar nature, we would expect fees to return to levels that are consistent with the prior years.
Thanks, Frank. That was a great explanation. Let me go to the next question. What do you think about quantum computing? So I think I have a couple of points I'd like to make about quantum computing.
One is Intel absolutely has research going on and we believe we are one of the leading companies in researching quantum computing. You've heard about some of our systems that we've delivered, a 17 cubit system, a 49 cubit system. These systems that are coming out right now and that you hear about out there are really research systems that are, for the most part not able to do any kind of meaningful application. But they're teaching people programming models, how quantum systems are built, interactions between cubits and how you maintain that connectivity basically between the cubits that make up a quantum system. So we're learning as an industry really how systems are built.
The next thing that needs to occur is we need to go from these tens of cubits to millions of cubits. When you think about a system and the ability to really solve the large problems that we want to solve with quantum computing. Quantum computing is not going to be necessarily something that you use for real time applications. It's going to be things that solve large modeling problems like how do you predict weather? Can we with much more accuracy in a micro climates?
Can you understand earthquake, even predict earthquakes or volcanic activity or all kinds of modeling systems. Quantum is going to be really solving those kinds of problems that are unsolvable today by computers because of large data sets and the ability to really approach those data sets. To do that you need millions of cubits. I still say 10, maybe 15 years on the outside before those kinds of systems in quantum computing are really available in any kind of scale or mass. But I'm positive about the future of quantum computing.
It will be something in most of our lifetimes that becomes available and does change the world and how we are able to see and understand the world. So it's important and Intel is absolutely investing and doing research and leading in the way there. Okay. I think our probably last question that we're able to get to this morning. In 2019, your competitor AMD expects to ship 7 nanometer data center processors.
Do you believe that you'll be able to roll out products that compete effectively with these chips? Or will the 10 nanometer delay pose a risk to your market share in DCG? And my answer, just like we answered in the earnings call earlier this in April, is absolutely not that we believe that our 14 nanometer technology still has a lot of leg room left in performance improvement along with our architectures. And we can continue to deliver that leadership performance, not only in the data center, but also in client computing for your PCs and across the gamut of products that our IA cores go into. So we are very confident and we have plans to continue to drive those leadership products at an even more aggressive level.
But it's still critical that we continue to improve the yields and deliver our 10 nanometer in 2019 as well. So we're comfortable with our roadmap. We think we have one of the best roadmaps that Intel has had in its history moving forward. So with that, I'm going to thank you for all your questions. The question and answer session has to be closed now for live questions and answers.
And Susie, could you do now the voting results?
Sure. Thanks. The final results will be available early next week. The preliminary results of the stockholder vote are as follows. Each Board nominee received a vote of more than 96% of the shares voted, and so each nominee has been reelected.
On the ratification of the selection of the company's independent auditors, approximately 97% of the shares voted were voted in favor of the proposal, and so the proposal is approved. On the advisory vote to approve executive compensation, approximately 94% of the shares voted were voted for the proposal and so the proposal is approved. On the stockholder proposal recommending allowing stockholders the right to act by written consent, approximately 40% of the shares voted were voted for the proposal, so the proposal is not approved. On the stockholder proposal recommending that the Chairman of the Board be an independent director, approximately 30% of the shares voted were voted for the proposal, so the proposal is not approved. On the stockholder proposal recommending a political contribution cost benefit analysis report, Approximately 7% of the shares voted were voted for the proposal.
So the proposal is not approved. Final vote tallies, including the ballots submitted today, will be posted on our website at intc.com and in our next 8 ks filing with the SEC within 4 business days. As I mentioned, I'd like to direct your attention to Intel's Investor Relations website at intc.com. This website contains stock quotes, webcast events such as this meeting and other investor information. On the website, you can sign up for electronic delivery of stockholder communications, such as the proxy statement and annual report.
Electronic delivery reduces the paper in your mailbox and reduces the company's expenses.
Thank you, Susie. Mr. Bryant wasn't feeling good this morning. So Andy went and stepped out for a bit. So I'm going to bring the meeting to closure as the CEO and Director.
Our agenda having been completed in the time adopted for adjournment has arrived. I'd like to declare this meeting adjourned. On behalf of Intel, I'd like to thank you for attending this year's stockholders meeting. Thank you very much.