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 the 2017 Annual Meeting. On my right, I'm joined by Brian Krzanich, our CEO and on my left by Suzanne Miller, Intel's Corporate Secretary, who goes by Sam. You will find today's agenda on the portal, personal logistics before proceeding with the business of the meeting. Sam and I will conduct the formal portion of the meeting and Sam will 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 6. We will also take live questions during this 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. Please know that we are committed to answering your questions. And if you provide us with your email address, we will answer any questions that we are not able to address during the meeting due to time constraints. I will now turn it over to Sam 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 2020, 2017 were mailed notice of meeting and proxy materials on April 6, 2017. The affidavit of mailing and notice will be filed with minutes of this meeting. Mr.
Jim Alden of American Election Services, who has already taken his oath of office will be serving as Inspector of Elections for today's meeting. As of May 18, 2017, we had 4,700,000,000 shares outstanding that are available to vote. Mr. Alden has confirmed that we have 87% of those shares by proxy, which constitutes a quorum. Therefore, the meeting is duly constituted and we may proceed with business.
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 ks 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 presentations, you will find on our website intc.com, the required reconciliation to the most directly comparable GAAP financial measures. 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 845, 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 turn it back over to Andy to introduce our directors and present the first two proposals.
Thanks Sam. The first proposal is to elect 11 directors to Intel's Board. The 11 nominees to the Board are Anil Bushri, Co Founder and CEO of Workday Reed Hunt, Principal, REH Advisors Omar Ishrak, Chairman and CEO of Medtronic Brian Krzanich, CEO of Intel David Patrick, Chairman and CEO of Red Eagle Ventures Greg Smith, CFO and Executive Vice President of Corporate Development and Strategy of Boeing Frank Yiery, Executive Chairman of CamberView Partners David Jaffe, Professor at Harvard Business School and me, Andy Bryant, your Chairman. The following two nominees could not attend today's meeting: Ambassador Charlene Barshevsky, Senior International Partner at the law firm of WilmerHale and Doctor. Tsu Jae King Liu, distinguished professor, Department of Electrical Engineering and Computer Sciences at the University of California, Berkeley.
Before we move to the next agenda item, I would like to recognize Doctor. James Plummer, who is retiring from our Board today and John Donahoe, who is not standing for reelection. On behalf of the entire Board, I would like to thank Doctor. Plummer for his approximately 12 years of service and Mr. Donohoe for his 8 years of dedicated service.
The second matter today is ratification of the selection of Ernst and Young as Intel's independent auditors for 2017. Jeff Lang, a senior partner of our audit team from Ernst and Young is here today and is available to answer questions during the question and answer session. I will now turn it over to Sam to present the remaining proposals.
The 3rd item on the agenda is an advisory vote to approve executive compensation, also known as say on pay. We're asking stockholders to approve on an advisory basis the compensation of Intel's listed officers as described in detail in the proxy statement. 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 will consult directly with stockholders to better understand any issues or concerns raised through the stockholder votes. The 4th item on our agenda is approval of an amendment and restatement to the 2006 Equity Incentive Plan as described in the proxy statement that would extend the plan for an additional 2 years to 2020.
If not approved, the 2006 Equity Incentive Plan will terminate in 2018. Intel has a long standing practice of granting equity awards not only to its executives and directors, but also broadly amongst its employees. In 2016, approximately 84% of Intel's employees received an equity award. The 5th item on our agenda is an advisory vote to approve the frequency of the stay on pay vote. We are asking stockholders to vote on whether future stay on pay votes, such as the one in proposal number 3 should occur every year, every 2 years or every 3 years.
Our Board of Directors recommends that stockholders vote to conduct future advisory votes to approve executive compensation every year. The final agenda items today are votes on 2 stockholder proposals. The first stockholder proposal was submitted by Northstar Asset Management Funded Pension Plan. Its representative, Ms. Mari Schwartzer will be presenting the proposal.
Ms. Schwartzer, we would like to offer you 5 minutes to present your proposal.
My name is Mari Schwartzer from Northstar Asset Management in Boston. Northstar is the beneficial owner of almost $3,200,000 of Intel common stock. I'm here to ask for shareholders' support of Resolution Number 6 regarding political contributions linked to our company. At the heart of this proposal is that whatever the company stands for should be represented in all arenas of the company's public activity, including political contributions. Shareholders want good governance and we want to know that the management team overseeing political contributions is carefully vetting the endpoints of all money that is associated with the company.
Unfortunately, we don't see such an examination. In fact, we came to an agreement with Intel in 2013, which would have put in place the examination and reporting that this proposal is requesting. In the ensuing 4 years, not only has Intel never produced the report promised, which allowed us to withdraw that proposal, but the company PAC has continued to make contributions, which in our opinion, undermine the company's goals, shareholder value and our employees' rights. In those ensuing 4 years, Intel PAC has contributed to several politicians that we believe are working at cross purposes to Intel Company values. For example, why did our PAC give to Mitch McConnell, an outspoken politician trying to repeal the Affordable Care Act?
As the company committed to gender equality, why did our PAC in the last 2 years give to 28 representatives and 9 senators who voted against the 2013 reauthorization of the Violence Against Women Act? We as shareholders want to know why the Intel PAC made contributions in the last 2 years alone to at least 3 original co sponsors of the Defense of Marriage Amendment known as DOMA, which defined marriage as a union between 1 man and 1 woman, discriminating against each of our LGBT employees who sought to marry their same sex partners. These contributions that we consider to be egregious misalignments with what the company stands for are easy to uncover. We believe that shareholder value, employee morale and company brand name depend on management being aware of these incongruities and being prepared for any critique. The 2010 Citizens United case opened the floodgates on corporate political contributions.
Justice Stevens commented that, a democracy cannot function effectively when its constituent members believe that laws are being bought and sold. When corporations are allowed to freely spend on electioneering with 0 accountability to shareholders, our only recourse is to actively participate in corporate democracy. Without corporate democracy, company treasury and PAC contributions become just one more source of power that threatens to undermine our political system just as Justice Stevens feared in his dissent. When Intel engages in behavior that is contrary to our company's own stated principles and values, then it is up to shareholders to take a stand. We ask that you vote for Resolution 6.
Thank you.
Thank you, Ms. Schwartzer. We take the issue of political accountability seriously and are committed to transparency around our contributions disclosure. Please refer to the 2017 Intel proxy statement for the board's views on this proposal. Ms.
Swartz, we appreciate you joining us today. Is there any final comment you'd like to make?
No, thank you.
Thank you. The last proposal item is a stockholder proposal submitted by Mr. Eric Rehm and Ms. Mary Geary, who have appointed Investor Voice as a representative for this proposal Mr. Bruce Herbert, who will be presenting the proposal.
Mr. Herbert, we would like to offer you 5 minutes to present your proposal.
Thank you. Before commencing, if members of the press would like to ask questions or follow-up on anything we present today, our e mail address is teaminvestorvoice.net. Ladies and gentlemen, I am Bruce Herbert shareholder sponsored items, which is how 61 percent of Intel peers count votes. This preponderance of Intel peers rely on a simple majority standard because it provides the most democratic, clear and accurate picture of the intent of those stockholders who are both informed and decided. This standard only accounts votes that are affirmatively cast for or against an item and excludes the abstain votes of those who have formally declined to express an opinion.
A simple majority standard does not arbitrarily ascribe negative intent to those who purposely abstain, nor does it allow Intel to pick winners and losers by calculating shareholder items differently from how it tallies its own director election. Such practices make Intel an outlier among its peers. In our negotiations, Intel made clear that it values and acts upon data. In line with this, it provided a list of the 23 companies it considers peers. However, Intel's interpretation of its own data was focused on just one segment of said peers.
The company is also incorporated in Delaware. Since Intel is actually headquartered in California and its markets are transnational, there is neither logic nor utility to such a narrow point of view. Looked at as a whole, a more complete assessment of Intel's peer group actually reveals 2 facts. Number 1, 61% of all Intel peers use the simple majority standard requested by this proposal. And number 2, every single one of the company's peer group that is not Delaware chartered and fully 36% of those who are use a simple majority formula.
A chart of this data is linked in the proxy on Page 86, first bullet point. We call on Intel to live up to the necessary conclusion drawn from its own data and to follow the good governance best practices set by Intel's self described peer group. In summary, counting extensions artificially depresses the appearance of support for shareholder concerns relative to the director election. Counting abstentions is unnecessary since shareholder items are typically non binding. Counting abstentions is confusing because it treats management's director vote more favorably than shareholder items and counting extensions is inconsistent with 61% of Intel's self described peer group.
In closing, the simple majority standard proposed by Item 7 and used by most of Intel's peers provides shareholders with better information about vote outcomes, allows more accurate communication between stockholders and the Board and eliminates the 2nd class treatment of shareholder items relative to management's director election. Therefore, we ask Intel to adopt simple majority voting for shareholder proposals. Please vote for item number 7. Thank you. That e mail again for anyone wishing to follow-up is teaminvestorvoice.net.
Thank you, Mr. Herbert. The Board certainly recognizes the importance of good corporate governance. Please refer to the 2017 Intel proxy statement for the Board's views on this proposal. We appreciate you joining us today, Mr.
Herbert. Is there anything else you'd like to say?
Well, I was going to wait until the question and answer period because I was going to talk about the investor or rather the virtual only format, which we find very discouraging to shareholder democracy and true participation and communication with the Board and management.
Thank you for your comment, Mr. Herbert. Because it is now past 8:45 a. M, the polls are now closed. Next, Brian will present a company business update.
Good morning, everybody. I'm really excited to be here this morning. This is completion of my 4th year as the CEO of this great company and my 5th shareholder meeting. So it's very exciting for me to be here. This morning I thought I would talk about really three things, our 2016 results, kind of how we look at the market in general, data is really driving growth and innovation, not only in Intel as a company, but really the industry and we believe just the world.
And then given that, what is Intel's strategy to really win amongst that ecosystem? Okay. So with that, let's get into the first section, 2016 results. We're really proud. It was a record year 2016.
We closed the year at $59,500,000,000 We were all really hoping to get up to $60,000,000,000 We're working on that for 2017, but really a record year for Intel from a revenue. Gross margins held at 63.2%. Again, another great year showing that our product roadmap and our product position in the market is as strong as it's ever been. And we saw earnings per share growth at $2.72 That's up $0.22 year over year just to give you a feeling for what kind of growth we saw in return to shareholder from an earnings per share standpoint. So for us, we look at 2016 and really look at it as a great year with good growth and really good execution towards our long term strategy.
If you take a look at the next chart, this is really our shareholder return. We looked at as of twelvethirty or the end of 2016, our 3 year shareholder return relative to the S and P and the Dow averages. And you can see that Intel has grown faster in both for the 3 year time. And even over the 1 year time, we continue to grow, although less than the Dow and the S and P in that timeframe. Let's take a quick look at really what the businesses were that grew and drove that growth in 2016.
For CCG, which is our client computing group, think of it as PCs, tablets, 2 in one devices, gaming consoles, It was really a phenomenal year of growth driven by real innovation both by Intel and our partners that bring these devices to market typically. Strong execution in a product roadmap and a real great segmentation, thinking about the products that are important for gamers, for 2 in one devices, for set top boxes, allowing us to really have higher product ASPs in this segment. In the data center group or DCG, we continue to grow double digit growth rates in cloud, in networking, in comms and our adjacency businesses like Omni Path Fabric and Silicon Photonics and those areas. It's brought down by enterprise computing, what I call the classic big hardware in large companies, but still had high single digit growth for the year. Data center group continues to grow and we continue to see this as the next real big engine powering Intel along with the client group.
Our IoT group, which is focused really on industrial, retail, security and when we talk about security, we're talking about really intelligent security cameras that can identify people and really understand video. It grew in double digit growth again. It's had record revenue and we're really seeing this be becoming a strong business and a large business as it grows in Intel in double digits. Our PSG group, which is the Ultera FPGA group that's come over now, it's had a year as being part of Intel, really proud of what that team has delivered. One of the big milestones was actually delivering a 14 nanometer Stratix10 FPGA product.
That's an internally manufactured FPGA on Intel silicon, really a great job getting that done within the year. We're now sampling that out to customers and we'll see that ramp in the latter half of this year and into next year. And these product roadmaps they take with FPGAs a little bit longer to get the customers to implement them into their products. But once you do, you see long product lifetimes and nice steady growth in those. So we're really excited about our Stratix10 family, great performing product.
And then lastly is our NSG or our memory group, really a record year there again, 3 d NAND and Optane. And so on 3 d NAND, which is the more of the classic NAND type SSD products, We continue to see great progress on our product roadmap there. We've started up our Fab 68, which is our fab in Dalian, China. So we're producing a larger percentage of the volume internal to Intel. And we're seeing our costs and our products really hit the targets that they need to in order to grow this business.
Optane, which is we've heard it called 3 d Crosspoint in the past and a variety of other technology names, has really finished most of its product qualifications and you're starting to see us ship it. So we finished the qualifications at the end of last year and really started shipping in the Q1 of this year. And this product is really designed to re architect how memory architectures within systems like data center systems, cloud based systems and even your client PCs work. And we're really excited about what 3 d Optane can bring to the marketplace. So let's talk about then now that we've talked about 2016 and the record year, what's driving this growth?
And it's really driven by a view of the world that data is driving growth and innovation in the world and the ecosystem and just about everything that we see in our lives. And so let's take a look at some interesting data. These are estimates made by 3rd parties. But the average Internet user, so that's you and I sitting at home doing our Facebook, doing our searches and our tweets and things like that, we use about 6 50 megabytes a day today. That's going to grow to about 1.5 gigabytes by 2020.
So that's a more than 2x growth in data that you and I are going to produce on a daily rate. And if you think about it, the amount of content you create in pictures and videos is continuously increasing as a percentage. That's what's really driving that growth as an individual basis. But that's going to be tiny in comparison to the machines that are going to start delivering data to the Internet. The average autonomous vehicle, a car driving only 2 hours a day, which is the average time that a car drives, is going to generate about 4 terabytes of day.
So you can think of that, that's about equivalent to almost 3,000 people of equivalent data. You put a 1,000,000 of those autonomous cars on the road, that's equivalent to half the population of the earth worth of data entering into the Internet as those autonomous cars hit the road. A connected airplane will because it's running a little bit longer will run 5 terabytes a day. A smart factory is a petabyte a day. And then just video moving around the cloud is going to be 7 50 petabytes a day.
And this is the movies and TV programs and all that we all watch and download and share with our friends. Is more and more of that content becomes online and direct to consumers. Just the amount of data that's going to move around the Internet, not even created by you necessarily, but used by you is going to increase significantly. And when we think about this, this is what's really changing the world. This massive shift in the amount and quality of data that's going to come around.
This is why you see things like artificial intelligence growing, because now there's enough compute power and there's enough data to really make it meaningful and viable to do those kinds of calculations. So we believe that Intel is a data company. And what we mean by that is that we our job is to really allow that data to move freely around the Internet, to have analytics applied to it and to be used by all level of users, whether it be an individual user who is trying to watch their 4 ks video on their client device or whether it's somebody trying to do video analytics, understanding an athlete's performance or security cameras or something like that. Across that board, our job is to bring the data to the compute, make the compute as fast as possible and provide the answers and solutions to the end users to whatever that need is. And so we think of ourselves as a data company, but not in storing and holding data, but in actually providing the engine to manipulate and move that data around.
So what's our strategy? Given that we've now built a view of the world that says data is going to grow at a massive amount, and that is going to be key and that is going to allow new usages and new analytics to be applied to it. And we use this model, we call it a virtuous cycle to really think about how data is generated, moved and used. And this, as you look at what the moves we've made over the last few years, this picture kind of helps you understand and think about what it is that we're doing. So first is there's those things down at the bottom, those things in devices and those are everything from your PC, they're wearable devices that are measuring your heart rate or your distance or your steps, they're more complex things in a factory, There are the cameras, lidars and sonar and radar sensors on an autonomous vehicle.
All of these things are what's creating the data that's coming out and that's really being generated. You need to have some form of connectivity to allow that data now to move, because data sitting on those individual things is almost worthless. What you having your steps at the instantaneous moment is not that interesting. But having your over weeks or months and understanding are you getting stronger, are you going further, are you taking more steps each day, the number of days you hit your step goal increasing. To do that, it has to get up into the cloud and people have to apply analytics.
How do you compare against your friends? How do you compare against the norm? That connectivity is through our Wi Fi technology, which Intel is a leader in that technology, through our 3 gs and 4 gs modem technology, eventually as we go through the next couple of years, 5 gs. 5 gs is a
leader in that technology, through our 3 gs and 4 gs modem technology, which you've seen us really do a great
job over the last couple of years getting into that segment of the business and you see us in one of our leading phone manufacturers now. And eventually as we go through the next couple of years, 5 gs. 5 gs is a really ubiquitous type of connectivity. And then you get that up into the cloud and into the data center. And that's the other strength and we've talked about the data center growth and that becoming the next big engine because that's where the data is accumulated.
It's accumulated by you, it's accumulated against your peers, it's accumulated against the other cars and it's what's going to allow things like autonomous driving to occur. It's going to provide the precision maps, it's going to provide the machine learning algorithms for autonomous driving, only through the cloud and the analytics applied. And then the connectivity back down to the things because those learning, those artificial intelligence algorithms have to get down to your car, they have to get down to your watch or your phone or your PC. So you can do something with them. You can see, you can use, you can have an experience.
That experience is enhanced by this. And then the accelerant technologies, you see us making investments in that. The investments in memory and 3 d NAND are key to that in our opinion, because it really drives the performance and the ability to bring that data closer to the computing. Our FPGAs are used there, because that's what brings the software down into the silicon and allows the algorithms to occur at a faster rate and a faster time to give you the answers you want to have. And you see our recent acquisition of Mobileye is really an accelerant technology to allow better computer vision and better understanding of what's going on outside the car and other mobile devices.
So this is kind of how we see the world and how we picture our growth and how we think about our investments. If you take a look at this, I think the traditional market view of us is that we are a PC at a server company. If you look at that TAM, it's relatively capped at about $45,000,000,000 But we see the world in a much broader, more expansive view. We see it as a much broader PC segment. The data center is including all of these adjacencies, the 3 d cross point, the silicon photonics, the Omni Path Fabric.
The networking is a great example. Our market share and our growth rate there is our market share has still got a lot of room to grow. We're in the teens and we're growing at double digits. So there's a lot of growth. So we see the data center as a much more expansive.
Than when you see the non volatile memory segments is much bigger. And when you add all these up, we see our market as a $220,000,000,000 TAM rather than that $45,000,000,000 TAM that we talked about earlier. That's the more traditional view of Intel, that $45,000,000,000 but it's not how we see the world given that virtuous cycle that I just talked about. So how we win in this market? We first want to make sure that we're at the right market.
So we really think about the businesses that are driving these segments that we just talked about in this virtuous cycle. We have the right timing. Things like you've got to be getting into those autonomous vehicles now. Now is the time. Artificial intelligence, be a leader in that space now as it's emerging.
It's one of the smallest segments of the data center, but it's the fastest growing segment of the data center right now. So you need to have the products and you need to have the expertise there. Domain expertise and we've seen us hire strategic people from external to the company to really increase our expertise in these areas. Partnerships at M and A, you've seen both of those over this last year as we continue to grow and focus on these. And then we think about these things as end to end solutions.
You can't come with 1 piece of silicon when you're trying to build out an autonomous car with a partner. You really have to have that entire solution with them and give them one place to go for that technical and those analytics and the silicon itself. And then silicon and software leadership, which we believe is our strengths and the core of what we do here at Intel. I'm really proud of the leadership team that we have here. As you look across this, 25% of the executives of this management team are new to Intel in the last 2 years and that goes back to that but they're new to this level of leadership in the last 2 years.
And then if you go just to people who have moved to new jobs, because we think that's how you grow and really focus on new leaders, it's 67% of these are new to their roles. We're going to continue to grow this leadership team. I'm really excited about what we've brought to the shareholders as a leadership team, both in our strategy, our execution as exemplified by last year and really our view of the future. So my commitment to you also continues to hold is around our corporate responsibility. We believe that we continue to create value for our shareholders.
Our corporate responsibility report was released today. We've integrated a lot more new data. We tried to make it a little bit easier for people to read and understand. It's our 16th Annual Corporate Responsibility Report. And I really want to have you visit our website, download it, read about it.
And we're very proud of the results that we've accomplished from a corporate responsibility standpoint. Our sustainable supply chain, the diversity improvements that we've made and really leading the industry and trying to set the culture of of really our entire industry and really moving beyond diversity and thinking about it as an inclusive environment and just thinking about social impact and how does a company like Intel really drive social impact. So with that, I'll hand it back over to Andy for Q and A and thank you very much for another successful year.
Thanks, Brian. We will now proceed with the Q and A session. We will answer previously submitted questions as well as questions submitted on the web during today's meeting. We have received more questions than we will be able to answer in the time allotted during this morning's meeting. We will follow-up with all investors who have provided their contact information.
Thank you for the interest. Thank you for the questions. So let's get started. Question 1, which came in as a pre sent in question. Workday is the HR tool that Intel uses.
When was the clear conflict of interest for Anil Butchery declared as CEO of Workday? Isn't there at least an appearance of conflict of interest of having a CEO of Workday on the Board as we move to their software? So Intel signed its first contract with Workday to become our HR system before Mr. Bushrie joined the Board. After joining the Board, consistent with Intel policy, he has recused himself from all negotiations and all business conduct with between Workday and Intel, as have Brian and I made sure that we weren't involved as well.
So we do consider this a serious issue. It's one we have to focus on. We have strong controls in place and we follow those controls. From the web, this will be for Brian. Your competitor AMD now appears to be back with products in both the PC and data center markets after being absent for years and they seem confident that they can capture significant share from Intel in both markets.
What kind of share loss, if any, is Intel planning for? And does Intel believe that it can accelerate its product roadmaps to reestablish the large lead in product competitiveness that it previously enjoyed?
So this is a good question. First, I think let's take it to a higher level. We constantly think about competition and whether it's AMD or many other players over the years in almost every one of our segments, We actually think competition is both good for the market, good for consumers, but good for Intel because it really drives us to be a stronger and more competitive company. And I think any company that doesn't have good strong competition, it just isn't running at its best. For specific around really AMD and what are we thinking about for 2017, we've put in our forecast for 2017 our view of what AMD's roadmap is and our roadmap.
And more importantly, what we've done is, again, as an example of this driving a better We've pulled products in between 1 5 quarters as much we've pulled products in between 1 5 quarters, as much as 5 quarters, in order to bring an even more competitive and better product lineup to our consumers. And so given all of that, we're very comfortable with the forecasts we have for this year, both in revenue, share and our ASPs, our average selling price of our products. And we'll continue to monitor all of our competition across all of these products and segments that we do. And I think it will continue to drive us to execute better and pull in and drive better products throughout not just this year, but all the years in the future.
The next question from the web. I know that Intel wants to have a model virtual meeting. Conoco's virtual meeting allows people to make both comments and ask questions by phone as well as typing in comments. Why has Intel made this process so disembodied and difficult for any direct input to management and the Board? As you know, the pension funds of New York City have all companies holding virtual only meetings to move to hybrid meeting with an in person meeting as well.
The Pension Funds of New York see virtual owning meetings as poor governance as is the Council of Institutional Investors and plans to vote against nominating committee members if this process continues. Is the Board discussing the pros and cons of virtual owning meetings in light of this new round of opposition? Intel did not does Intel takes seriously the question of an in person meeting versus a virtual meeting. It was debated before last year vigorously for 6 to 12 months, quite frankly, as to whether we should do virtual or not. We have a robust investor outreach program.
We did go and talk to our major investors and got an agreement that a virtual meeting was worth trying would be okay. After last year's meeting, we went back again to all the majority of our shareholders and we asked questions about how did it work, was it acceptable and is this process okay. Again, we got no pushback. We got confirmation that it was okay. Why we do this?
It saves money. It's more efficient. The interesting question I had not thought of was should we allow, as Conoco does, people to actually make a comment by phone as well as just the Internet, that's a good input. We will look at that. We are looking to improve how we do this process.
We do want it to be as personal as possible and yet we don't want to waste a lot of corporate money on meetings that can be done more efficiently. Next question also from the web, live. How are the speed of your processes competing against the GPUs that NVIDIA makes for deep learning?
Okay, sure. I'll take that one. Again, another great question. We talked about deep learning and really artificial intelligence in general in my remarks, it's although the smaller segment of the data center overall, it's the fastest growing. And so we do see it as emerging workload and key to future growth.
We think of if you really understand artificial intelligence, there's both training and then inference and think about it as you teach it how to identify things, to make decisions and then you go out and you make those decisions. And so you need to have solutions that can go across that span of products. And then there are very different workloads. An autonomous car needs something very different than a security camera that's doing the same kind of deep learning or artificial intelligence that's different than a drone or a robot or something like that. And so we've really built what we believe is a broad spectrum of products that go from high performance, low power, like our acquisition of Mobidius that you saw last year.
This is an excellent system for cameras, for drones, for robotics, where low powered high performance are required, up to our Atom and then our Xeon Processors, which are actually the largest shareholders of artificial intelligence and deep learning algorithm applications right now. Our Xeon PHY products, our FPGAs, FPGAs are running more along the performance levels that you start to see the GPUs. And then you saw us make an acquisition last year of a company called Nirvana. Nirvana is an ASIC based deep learning tool, neural network based that is really meant to be at the very top end, it's a high power, high performance, you're going to use this in the data center for very deep learning and that one very much outperforms a GPU based system. So we've really built a broad spectrum of products so that as a company we can go to our customers with solutions that fit their needs based on the workloads, the application, the energy levels they can support and across that.
And we are winning share and we believe we are growing in this segment of the market.
Next question again for Brian. It appears that the investment for mobile icons had a very high cost. How did the valuation of a company with approximately $360,000,000 in revenue come out to become something approximately $15,000,000,000
Sure. We're really excited about our acquisition of Mobileye. And it's because we really view the autonomous vehicle market when you just take a look at that market as really a $30,000,000,000 hardware TAM or total market and probably include hardware and software, something in the order of $70,000,000,000 maybe more on an annualized basis. And that's really a much bigger TAM that I think that people really think about. And remember I said in our discussion that you need to provide complete solutions.
And because when you walk into an autonomous car manufacturer, they don't want to just talk to you about one part of it, your ability to produce one segment. And what we needed to do to build out the complete platform, we have the data center, we have the 5 gs and 4 gs connectivity, we have the compute engine, we needed the ability to really put in what we believe is the world's best computer vision system for really having the car So that So that's why we're excited about it and why we felt like we are willing to invest that money. The additional thing you need to understand is assuming that we're able to get regulatory approval and close the deal sometime towards the end of this year, remember we said it would be about 9 months and we did it back in March timeframe. The acquisition will be EPS accretive in its 1st year post the acquisition. So it will bring earnings per share growth to you as a shareholder right out of the gun based on this.
And remember, we're buying this for a market that's the autonomous car market most people agree is sometime in going to start seeing it in 2019 to about 2021 is when you will start to really see this. So the growth that we're talking about is really out in time a couple of years. But you have to be there now to get in those designs and to really win in that marketplace.
And again for Brian, how is Intel positioned for the increased use of devices other than conventional PCs?
So that's a good one. I think I did a pretty good job. Hopefully, I did a good job in my presentation talking about the growth segments that we're looking at outside the PC. And if you look at what we forecasted for this year, we're not saying the company is going to grow based on our PC. In fact, we said PCs would be down mid to low single digits as a company.
And we are really growing in those other four vectors, the data center, IoT, NSG, FPGAs, those are the 4 areas that are really going to be our growth engines. And those are the, I'll call it, other devices per se that we're really focusing on and targeting on in order for us to grow. And it's playing out quite nicely. If you take a look at 2016, the PC was has declined as a percentage, even though we had record revenue. The PC declined as a percentage of that revenue.
It's just over 50% now and we expect over the next couple of years it will as our revenues grow, still the PC will become less than 50% of our revenue. And if you look at it on a profit basis, it is already less than 50% of our profit. We're really proud of that transition. We moved it from when we started this to in the 30s to now more than 50% of our profit coming from these growth areas. And that's great performance and great job of transition by the team.
Live from the web, what stage of planning for next CEO succession is the Board currently at? We think we have a pretty robust process at this point. During the last transition, we used an outside firm to help us with the process. We have already engaged them, and we are working at that level at trying to figure out what the next the skill sets the next CEO would be, what the company will look like when the next transition happens, which, of course, we hope is years out. We think Brian is doing a wonderful job.
At the same time, at the Board, we review the internal candidates who could possibly be the next CEO. We have and are working active development plans to improve their skill sets So that at the time, we are looking for a new CEO, we should have more than 1 multiple internal candidates. I would assume the Board at that point in time would also look externally to make sure we get the best possible person to be the CEO of Intel. We are it is actually an active, very good process right now. Next question.
Intel's data strategy be secure and safe from hackers.
Where we have things like secure boot and segmentation of data. What that means is that the system And that means that you can't go out and easily compromise that device and boot it up and get control of it. There are only then we go to the networking functions and we look at things like trusted devices and there's a handshake between Intel's devices at the edge and the networking devices saying, are these trusted devices that are on the network? If it's a non trusted devices, it isolates it and doesn't allow it access to certain segments of the network. And then you go back up into the data partition data that's key to the security of the device and put that into basically an enclave.
And then probably more importantly, so that's all the silicon level, but we work with our partners, our partners everything from Google and Microsoft and the device partners all through there to build software levels that right above our silicon and use those assets even in our SSDs that we build for memory function and storage, there are security features that the device manufacturers can access such that they know that there's been no compromise to that storage or that memory device and access to it. So we're constantly working through all of those layers to ensure that the security is the best we can deliver to our customers.
Next question. How do you protect company patents and electoral rights from insider and outside security issues?
Okay. I will take that one again. So first, I would tell you that we take this subject very seriously. And we operate all around the world. And so for both internal and external, as you look around the world, we have procedures and technologies that we use to protect our intellectual property.
And you can think of it as kind of tiered based on just how critical is the intellectual property. So things like the recipes to our silicon technology, which is the most critical to us in our most important intellectual property, we even go as far as no one person has the complete recipe and it's not stored in any one location and there's all kinds of protections we do to make sure that that intellectual property is protected and secure for both internal and that's internal I talked about, but external as well. We're very proud of we've had a very strong effort in patenting that intellectual property over the last few years and we've increased our patents in many of the areas and segments of our business to ensure that we're protected from that standpoint, which helps us protect our property from external. And then lastly, we vigorously defend it. We invented X86 technology as an example.
And we're very proud of that and we vigorously defend it at all times through relationships, through the court systems, whatever it takes to defend those things that we invent if we see them misused or taken in any way, shape or form.
Next question, could you give us insight into when we will see the first 10 nanometer products for desktop, computers and data center?
Sure. I'll take that one. 10 nanometers, I can tell you right now is going very well. We are on schedule to have production by the end of this year and we will be shipping to our end customers by the end of this year. So think of that as our PC manufacturing OEMs and other partners by the end of this year.
When they bring out products is always they have to go through their qualifications and get their form factors out there and all. So I'm very comfortable with shipping it this year. I think you'll see it on market in shelf really 2018 first half and it will ramp throughout 2018. But it's healthy. It's going quite well.
We review this on a regular basis, and we're confident that we'll be able to ship product this year.
Okay. The last question we will get to today on the webcast. I see that you're moving the company to be more data centric, increasing the overall total available market. But how will the announcement that Microsoft's operating system will run PC software on ARM based platforms impact Intel's bottom line and stock price? Has the new data centric strategy guarded against this competitive impact in time?
Great question. So simple answer is yes, we believe we've protected ourselves quite well. And the way you do that is there's been these kinds of products before and the way we go and compete against them is by bringing better performance at a lower cost. We believe that because we invented X86 as I talked about just a few minutes ago, our ability to bring unique features, unique functions and better performance at a better cost and power is absolutely there. And at the end, the customer always wants the best product for the best price.
And so we believe we have a very competitive, probably the most competitive roadmap that we've ever had in all of these segments in the PC specifically. And you saw us doing that last year, right? We grew both profitability and our ASPs last year in the PC segment, and we did that through great products. And so we will continue to do that. And then as I said earlier, we will continue to defend our X86 license and our X86 intellectual property as well as these products come out.
Thanks, Brian. Thank you for all your questions. The question and answer session is now closed. Sam, would you please provide the preliminary voting results?
Yes. Before providing the preliminary results, a correction to the board attendance. Doctor. Lu is in attendance at today's meeting. The final results will be available early next week.
The preliminary results of stockholder vote are: Each board nominee received a total of more than 95% of the shares voted and so each nominee has been reelected. On the ratification of the selection of the company's independent auditors, approximately 98% 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 vote to approve an amendment to our 2006 equity incentive plan, approximately 95% of the shares voted were voted for the proposal and so the proposal is approved. On the advisory vote to approve the frequency of the say on pay vote, 89% voted for every year and so every year is approved.
On the stockholder proposal recommending an annual advisory vote on political contributions, approximately 7% of the shares voted were voted for the proposal, so the proposal is not approved. On the simple majority voting stockholder proposal, approximately 10% of the shares voted were voted for the proposal, so the proposal is not approved. Final vote tallies, including the ballot 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. And now, I turn it back to Andy.
Thanks, Sam. As Sam mentioned, we would like to direct your attention to Intel's Investor Relations website at intc.com. The 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 expenses.
Our agenda having been completed and the time adopted for adjournment has arrived. I declare this meeting adjourned. On behalf of Intel, thank you for attending this year's Stockholder Meeting.