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AMD Ups the Ante in the Battle With Intel

July 27, 2009

Advanced Micro Devices Inc. took another step toward improving its standing against market leader Intel Corp. with last week’s disclosure that PC makers plan to use its Athlon Neo chips in low-power desktop products soon.

The Neo chip was designed run lower-end products, like ultrathin laptops that promise full functionality at lower prices than more traditional PCs.

Such systems remain the primary target for the processors. But Bob Grim, AMD’s director of client marketing, said that some PC makers are putting the processors in nettops, which are the size of hardcover books, and all-in-one PCs, which incorporate a central processor, a motherboard and a monitor in one box with a mouse and keyboard attached.

Many of those systems today run Intel’s popular Atom processor.

“We’ve known all along that this type of technology would really work well in multiple platforms and multiple types of form factors,” Grim said. The first Neo-based nettop and all-in-one PC products could ship later this year, he added.

Dean McCarron, an analyst at Mercury Research in Cave Creek, Ariz., said the AMD processor may quickly hold a graphics advantage over Intel’s Atom chip, thanks to its more advanced graphics core. However, he did note that Intel plans to add a graphics core to the Atom chip in the future.

Nevertheless, McCarron said extending Neo to higher-end computers could prove to be a strong move for AMD. “It’s absolutely relevant. It’s playing to AMD’s long-term strength that they have been strong in desktop and notebook, and they have been strong in low-cost desktop.”

The expansion of the Neo market was disclosed just days before AMD disappointed analysts by announcing that its second-quarter revenue declined 13% compared with the same period last year, to $1.2 billion; its loss narrowed to $330 million from $1.2 billion.

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