Advanced Micro Devices

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appears to have trumped

Intel

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again by beating the world's largest chipmaker to market with its dual-core processors. But time may ultimately be on Intel's side.

Shares of AMD jumped nearly 6% Friday on reports that it will launch its dual-core Opteron processors at an event in New York on April 21 -- the two-year anniversary celebration for the 64-bit Opteron chip.

Intel is expected to launch its dual-core chips later in the second quarter.

AMD has only said it will have "several significant announcements" at the event, but speculation has been growing that the shindig will mark the launch of its dual-core chips.

The initial rollout is a significant milestone for AMD, but even more important for investors is the marked differences between the two approaches that Intel and AMD are taking to spread the dual-core message.

Dual-core chips are seen as enablers of better performance, not through increased speed but through the ability to delegate different tasks at the same time -- an important feature as computers are increasingly required to handle computing and communications functions simultaneously.

Through the use of multiple cores, chipmakers expect to continue the industry's usual pace of innovation, known as Moore's Law. The use of multiple cores will also help push enhanced capabilities for a wide range of electronics products, from notebook computers to cell phones to consumer electronics gear. Dual-core chips from

IBM

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and

Sun Microsystems

(SUNW) - Get Report

already exist, but based on a chip architecture used primarily in high-end servers and mainframes.

AMD's first dual-core chip will come from its Opteron family, which are designed for servers and workstations. This is the computer class expected to benefit most from multicore chips, as these boxes require the most computing power and already have applications and operating systems designed to handle separate threads of data simultaneously.

Intel has targeted its first dual-core chip at the gaming market. Computer games, though, haven't yet been written to accommodate multiple threads of data, which will minimize the performance benefit that can be achieved through the use of these chips. This also means that Intel's initial dual-core chips won't be pressured to perform up to such a high level.

That's probably good for Intel's dual-core chips, which have been rushed. Earlier this year, Intel surprised everyone by saying its dual-core offering for the desktop would be out in the middle of the year. The company had previously only stated that it would have dual-core chips out for the desktop, mobile and servers sometime in 2005, with most initial expectations targeting late 2005.

A Different Look

AMD and Intel's dual-core chips are also different in how they are built. AMD's Opteron was designed from the ground up to evolve from a single core to multiple cores. The Pentium evolution was expected to continue in a single-core format for several more years.

As such, AMD says data flow better between its cores because of a feature it calls its Direct Connect architecture. Rob Enderle, principal of research firm Enderle Group, characterizes it as a "dedicated pipe" for information to flow through. "They get a substantial amount of the performance through an interface that's designed to take the load," he says.

Enderle says Intel's initial dual-core offering will be more of a place holder than a real technology breakthrough. "They are behind right now, but they don't want to appear behind," he says.

Indeed, investors remember Intel endured a rough 2004 with execution problems and product delays. The company also trailed AMD in its rollout of chips capable of processing data in chunks of 64 and 32 bits. Its accelerated dual-core plans were due to AMD setting its launch sights on mid-2005.

Still, Intel isn't exactly on the rocks. As the world's largest chipmaker, its chips are used in four of every five computers manufactured around the world. The company's manufacturing capabilities are more robust and more advanced than any other semiconductor company in the world. AMD ranked as the world's 11th largest chipmaker last year and has been viewed as a laggard to Intel in terms of technology and execution for much of its history.

Analyst Eric Ross of ThinkEquity Partners acknowledges that AMD has been ahead of Intel in technology development lately, but he discounts the advantage that AMD has by launching its dual-core chips ahead of Intel.

"I don't think it's particularly meaningful," he says, adding that Intel has made more strides recently by being able to pull in its own dual-core launch plans by almost a full year. "They have removed a lot of the advantage that AMD expected to have in 2005," he says. Ross' firm has no investment banking relationship with either AMD or Intel.

He says Intel's dual-core performance might lag that of AMD's, but he doesn't see it as something the company can't overcome. "They are going after this market by powering through it rather than creating an elegant architecture," he says. "They can make up for this in other ways, like platform marketing and innovative chipsets."

Similarly, after the initial launch excitement, AMD's victory in getting to the marketplace may mean little for the stocks for either it or Intel.

That's a harder question to answer because of the time expected before the dual-core market really takes hold. "Dual-core will not really be important until next year, and maybe not until after that," says Enderle.

By that time, expect Intel to be up and running with a full line of dual-core processors.

In addition, Bill Whyman, president of Precursor Group, an investor-focused technology research group, notes that pricing issues and software issues have yet to be fully resolved surrounding the use of dual-core chips. "This is not a next-quarter issue," he says.

AMD might have won the battle by being first to market, but it certainly hasn't won the war. It's a pattern that has been repeated before: Even though Intel was late with its introduction of 32/64-bit chips, sales of these processors surged for Intel in late 2004, seemingly taking away much of AMD's momentum.

Intel also has so far kept

Dell

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, the world's largest manufacturer of computers, from using AMD chips in any of its products, despite heated speculation late last year that Dell would source AMD for some of its chips. Although Dell continues to say it's "open" to change, it remains an Intel-only house and is the lone major box manufacturer not to use AMD's chips.

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