An Exclusive Wall Street Transcript Interview With The President And CEO: Atmel Corporation (ATML) - Steven Laub
December 21, 2011 - The Wall Street Transcript has just published Semiconductors Report offering a timely review of the sector. This Special Report contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. Please find an excerpt below.
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Steven Laub has served as President and Chief Executive Officer of Atmel Corporation since August 2006 and as a Director of Atmel since February 2006. From 2005 to August 2006, Mr. Laub was a Technology Partner at Golden Gate Capital Corporation, a private equity buyout firm, and the Executive Chairman of Teridian Semiconductor Corporation, a fabless semiconductor company. From November 2004 to January 2005, Mr. Laub was President and Chief Executive Officer of Silicon Image, Inc., a provider of semiconductor solutions. Prior to that time, Mr. Laub spent 13 years in executive positions - including President, Chief Operating Officer and Member of the board - at Lattice Semiconductor Corporation, a supplier of programmable logic devices and related software. Mr. Laub holds a B.A. in economics from the University of California, Los Angeles, and a J.D. from Harvard Law School.
TWST: Please begin with a brief description of Atmel Corporation.
Mr. Laub: Atmel (ATML)is a leading semiconductor corporation. We are focused on high value-added microcontroller, automotive and memory products which primarily serve the industrial, smartphone/tablet, consumer and automotive marketplaces. I became the President and CEO of Atmel in August of 2006. Prior to my appointment, the company was involved in an enormous variety of products and technologies and was a fully integrated manufacturer. We dramatically changed Atmel's strategy by choosing to focus on a few primary product lines, with our microcontroller products and microcontroller-related technologies as the core for the company. In addition, we decided to adopt a fab-light manufacturing model.
These decisions have driven an enormous transformation of the company over the last five years as we exited from over 20 different businesses and product lines, and exited from four of our five wafer-fabrication facilities.We have experienced enormous growth in high-margin proprietary products while reducing our exposure to commodity products and significantly reduced our manufacturing costs. The positive financial impact from these changes has been dramatic. For our third-quarter 2011 results, we achieved our 10th consecutive quarter of revenue growth as revenues climbed to $479 million, up 8% year over year, and up 15% when you exclude a divestiture that was completed in the third quarter of last year.
We had net income of $117 million or $0.25 per diluted share. Our microcontroller business, which is the core of the company, has set record revenues so far this year. It exceeded $300 million last quarter for the second consecutive quarter and comprised 63% of our total revenues. As a company, we are focused on high-growth markets, the most prominent being our capacitive-touch or touch-sensing products. These include the technologies you see today in products such as smartphones and tablets. The touch technology acts as a human interface between people and devices. It is a key focus area for the company and probably the fastest-growing area in the semiconductor industry today.
TWST: You mentioned touch before. The Android tablets, iPads, the iPhones and the Android phones have been very popular over the years. What's Atmel doing in this segment?
Mr. Laub: Soon after I joined the company, we foresaw the potential for enormous growth in the touch or human interface marketplace. As a result, in March 2008, we acquired Quantum Research Group, the leading independent developer of capacitive touch solutions. After completing the acquisition, we combined their advanced touch I.P. and technology with that of our leading microcontroller technology and developed a very powerful touchscreen controller, which we call maXTouch.The greatest growth area within microcontrollers has actually been this touch sensing area, and it's a market that's grown from less than $100 million just a few years ago to nearly $1 billion this year.
Atmel has been aggressive in this market, and we have achieved the clear leadership position, driven by our maXTouch product line. We have gone from virtually zero revenues in 2009 in our maXTouch products to over $140 million in 2010, and we expect this product line to exceed $375 million this year. Our maXTouch touch controller products have been widely adopted in smartphones and tablets serving major products from such customers as Samsung, HTC, Nokia, Motorola, Dell, Acer, Asus, LG and others. To maintain our technical and market leadership in touch technology, we plan this quarter to begin sampling our next generation of industry-leading maXTouch products.
TWST: Do you measure the market in terms of market share at this point? How do you see those shares and particularly your own company's position changing or evolving over the next few years?
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