Compaq to Use AMD’s Clone of Intel’s 486 Microprocessor Chip in Some of Its Products
In a blow to Intel Corp., Compaq Computer Corp. said Wednesday that it picked Advanced Micro Devices Inc. as an additional source for microprocessor components.
Top-tier personal computer makers have stayed away from AMD for fear of getting tangled in the legal battles between Intel and AMD. Intel, the world’s largest independent maker of microprocessors, and AMD have traded several lawsuits to determine if AMD has the right to copy Intel’s best-selling 486 family of microprocessors.
Houston-based Compaq said Wednesday that with AMD as a supplier in addition to Intel, Compaq has the flexibility to deliver a greater range of computer products “with the right combination of price, performance and features.”
“Intel remains our primary microprocessor supplier and a strategic partner of Compaq, and they will continue to provide the majority of microprocessors for Compaq computers,” said John Rose, senior vice president and general manager of Compaq’s desktop PC division. “However, AMD and Intel each offer unique combinations of features, price and performance not available from the other.
“By working with them both, we can--over the long term--more likely deliver a computer that meets the specific needs of every consumer and business customer,” Rose said.
AMD shares gained 62.5 cents to $20.625 while Intel fell $1.375 to $63.625. Compaq lost $2.125 to $81.125.
AMD said initial shipments to Compaq of its 486 microprocessors will begin in the current quarter. Compaq computers using AMD chips can be expected in the first half of the year, Compaq said.
Separately, Compaq Computer Corp. said it earned $151 million in the fourth quarter, a 70% jump from a year earlier, as sales climbed around the world.
The company is one of just a handful of PC makers to improve both market share and profitability in the period.
The third-largest maker of personal computers earned $1.74 per share in the three months ending Dec. 31. A year earlier, Compaq earned $89 million, or $1.11 per share.
Sales were $2.2 billion, up 54.7% from $1.4 billion a year ago.
