AMD, Nvidia Shares Surge On Intel News

News of Intel's change is a shot in the arm for its rivals. AMD has had a tough time keeping up with Intel in recent years and spent $5.6 billion on ATI in 2006 in an attempt to boost its graphics offerings.

AMD, based in Sunnyvale, Calif., can now concentrate on its graphics push, safe in the knowledge that its powerful nemesis still needs to work out kinks in its own strategy.

AMD recently landed a $1.25 billion settlement in an antitrust dispute with Intel, easing its debt burden from the ATI deal.

The chipmaker also predicted a better gross profit margin during 2010, as chip sales improve.

Things look rosier for Nvidia too, which beat analysts' estimates in its recent third-quarter results. The company's GPUs, or Graphics Processing Units, performed best, with sales up 25% quarter over quarter.

The results came just two days after Nvidia and a number of chipmakers were downgraded by Morgan Stanley. The analyst firm had downgraded Nvidia to sell on concerns that chip supplies were running ahead of demand.

-- Reported by James Rogers in New York

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