Intel, AMD Reach $1.25 Billion Settlement

SANTA CLARA, Calif. (TheStreet -- Intel(INTC Quote) has buried the hatchet with rival AMD(AMD Quote), paying $1.25 billion to settle the firms' longstanding legal disputes.

The chipmaker announced the settlement in a statement released before market open on Thursday, ending the firms' many legal wrangles.

"Under the terms of the agreement, the parties will end all outstanding litigation, including antitrust and patent cross license disputes," said the Intel statement. "AMD will withdraw all of its regulatory complaints against Intel worldwide and both parties will enter into a new 5-year patent cross license agreement."

Intel also adjusted its guidance to reflect the settlement. The tech bellwether now expects fourth-quarter spending to be around $4.2 billion, up from its previous expectation of $2.9 billion.

-- Reported by James Rogers in New York