Intel Says Xeon Chip Flaw Will Delay Computer Sales

Intel Corp. said Thursday that sales of some computers will be delayed by a flaw in its new Xeon microprocessor, which it will unveil Monday.

The flaw in the Xeon is only a problem when the chip is used alongside the new 450 NX chip set in powerful servers, the machines that control computer networks. A chip set is the group of semiconductors that surround a microprocessor in a computer.

Investors shrugged off the flaw when it was first reported earlier this week. The Xeon isn’t expected to sell in large numbers until later this year.

“We’re going to take a few weeks longer to complete validation,” or testing, of Xeon and the new chip sets, said Tom Waldrop, a spokesman for Santa Clara-based Intel.

Intel shares fell $1.75 to close at $75.63 on Nasdaq.

The extra week of testing will mean that computer makers won’t be able to ship machines that use the chip and chip-set combination. Intel won’t say who will use the new devices, though Compaq Computer Corp., Dell Computer Corp. and other large Intel customers are expected to be among them.

Waldrop declined to say how the flaw in Xeon is affecting computers that use the 450 NX chip set. Intel on Monday will unveil Xeon, the 450 NX chip set and another chip set, called the 440 GX, that will be used in computer workstations.

“We’re pretty confident” that there is a simple, fast solution to the problem, Waldrop said. “The good news is that this [chip] isn’t in the market” yet.

In 1994, Intel took a $475-million charge to replace flawed Pentium chips that caused mathematical errors in rare instances.

ZDNet, the online version of PC Week, reported earlier this week that there was a bug in the new Intel products.