AMD Unveils New Quad-Core Chip

The company will aim a new platform at video gamers.
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SAN FRANCISCO --

Advanced Micro Devices

(AMD) - Get Report

released its latest microprocessor Monday, as the struggling chipmaker looks to plug an important gap in its product lineup.

AMD's new Phenom processor gives the company a quad-core processor for the desktop PC market,

a year after

Intel's

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first quad-core chips were released.

In addition to the new processor, AMD also unveiled an all-in-one bundle of silicon components for desktop PCs, dubbed Spider.

The Spider platform pairs AMD's Phenom processor with an ATI Radeon HD 3800 graphics accelerator and a so-called chipset that supports key PC functions, representing the first tangible product to come out of AMD's $5.4 billion acquisition of the Canadian graphics firm ATI in 2006.

"It's a good example of the integration of AMD and ATI," an AMD spokesperson said. "It's one of our first platform launches that includes all the components from both companies."

Shares of AMD were recently off 3.8%, or 48 cents, at $12.16 in a down session for the overall market Monday. The stock is down nearly one-third since mid-July.

With the holiday shopping season about to begin, AMD is aiming its Spider package at video gamers and other consumers who make up the so-called enthusiast market for desktop PCs. According to AMD, the new technology offers improvements in performance and energy-efficiency, as well as the ability to build up by adding up to four graphics cards in one desktop PC.

AMD desperately needs new hit products to generate some revenue and shore up its profit margins. The company has lost $1.6 billion in the first three quarters of the year, and it is weighted down by $5.3 billion in debt.

Despite the technological advances AMD new products however, the various pieces of AMD's Spider package each face tough competition.

ATI's latest graphics chips, for instance, are considered a good value, but many of the most discriminating video gamers are partial to

Nvidia's

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new G8 family of graphics processors.

And Intel has been charging ahead with a steady stream of microprocessor releases. The company introduced its

latest processor, dubbed Penryn, earlier this month, featuring circuits that measure 45 nanometers, vs. the 65 nanometers used by AMD's Phenom. And Intel is slated to release chips based on a new microarchitecture in 2008.

Meanwhile, AMD has acknowledged that its ability to ramp its new quad-core chips in volume has been slower than expected because of "design and process tuning" issues. The initial versions of the Barcelona chip have been available only at low clock speeds.