AMD pins hopes on new chip

Struggling to rebound from a $574 million (£292m) loss in fourth quarter earnings it reported Tuesday, AMD has pinned its hopes for recovery in 2007 to its planned "Barcelona" quad-core Opteron server chip.

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Struggling to rebound from a $574 million (£292m) loss in fourth quarter earnings it reported Tuesday, Advanced Micro Devices (AMD) has pinned its hopes for recovery in 2007 to its planned "Barcelona" quad-core Opteron server chip.

Intel's competing "Clovertown" quad-core Xeon chip has been adopted mainly for high-end research server platforms since it launched in November, hobbled in part by a lack of multi-threaded software needed to take full advantage of the new chip technology. But AMD hopes to sell its Barcelona chip to users ranging from managers of high performance computing centres to small and medium-sized businesses (SMBs).

AMD expects a bounce in revenue when it launches the processor by the middle of 2007 since many customers have delayed buying new systems until it comes out. The company hopes Barcelona will allow AMD to finally break into the low-end server segment, including one-chip and two-chip computers and tower PCs as well as rack mounted servers.

"We're not yet in the SMB segment; it represents for us a great volume opportunity since we have so little market share now," said Kevin Knox, vice president of AMD's commercial business.

AMD will also try to squeeze extra profits from denser chips as it transitions from 90-nanometer chip design to 65 nm, and from more efficient manufacturing as it changes from 200mm to 300mm silicon wafers.

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