HP Using AMD’s K5 Chip, Not the K6

Hewlett-Packard Co. said it isn’t using Advanced Micro Devices Inc.’s new K6 because the chip’s too expensive, though it unveiled new sub-$1,000 PCs that use AMD’s older K5. AMD last week said a “top 10” PC maker this week would reveal that it’s using AMD chips. Several analysts said they believed that Palo Alto-based HP would be announcing its use of the K6. AMD said it expected no more announcements this week regarding new users of its microprocessors, which are the brains of a computer. Digital Equipment Corp. so far is the only major user of the K6, which analysts said represents AMD’s best challenge in three years to industry leader Intel. Using the K6 would make HP’s personal computers too expensive for the company’s target small-business user, an HP spokesman said. The K6, unveiled April 2, is designed to compete with Intel’s newest chips with multimedia technology. The K6 ranges from $244 to $469, about 35% less than Intel’s latest chips. HP said it’s using the K5 in its new line of Vectras, its first PCs priced at less than $1,000. Sunnyvale-based AMD shares rose 62.5 cents to close at $41.25 on the NYSE.