http://seekingalpha.com/article/248...-technology-conference-transcript?part=single
So, what do you think beyond the 50-50 mix of your revenues, when you come out the other side, what sort of profitability metrics, what sort of margins do you aspire to with that revenue mix?
Rory Read - President and CEO
Well, what you want you to do is you want to mix up to a higher margin over time. In the tactical timeframe, even if you go back to that earnings call in October of 2012 we laid out, hey, we’re going to break-even at such and such a dollar at $450 million.
Everyone calculated that of about 35% gross margin which is about where we ran the business.
What we’re doing right now as we diversify the portfolio, as we’re trying to mix into more margin accretive business, as Pro Graphics, it’s going to be in the, what, 50% to 70% gross margin range. The areas like dense server, getting back in the server with the next generation ARM architected solution and with the x86 core that's going to be very attractive. That's going to run in what 55% to 65% gross margin.Then you look at businesses like embedded that should be 50% to 60%. These are industry kinds of numbers.
And you like that stickiness about them because they last longer. And the semi-custom space, the earlier ones are at a lower gross margin because we got so much NRE to build those businesses, but as time goes on I would expect that you will see us perform at more consistent gross margins for the segments that those semi-custom products are in. Okay, so I would look for it to improve in ‘16 and ‘17 et cetera by mixing up throughout this.And even in the PC space look at the work that we're doing to move into commercial, that's really good work and into the workstation pace and Pro Graphics, win with the winners, HP, Dell, Lenovo, make sure that we are getting architecturally relevant with them and we have a diverse portfolio, you don’t want to have a business where it’s centered all over entry consumer notebook, that's not the right space. We're diversifying into commercial and look at the progress we’ve made. I'm working with Lisa and John Byrne we're selling to marquee commercial customers this summer with the first launch of those products, that's good progress.
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