AMD Pins Hopes On Hardcastle

Advanced Micro Devices is banking on its first commercial desktop platform to help accelerate its path to profitability by the end of the third quarter as per guidance given by AMD CEO Hector Ruiz in late December and reiterated in the chip maker's first-quarter earnings call earlier this month.

The Sunnyvale, Calif.-based company on Monday introduced the commercial desktop client platform, codenamed Hardcastle, as part of its AMD Business Class initiative, which will also include commercial notebooks based on AMD's upcoming Puma mobile platform, projected for availability this quarter. The initial desktop offerings from AMD and its partners are generally tailored for SMB, mid-market and public-sector deployments, while enterprise-class SKUs will be available later, said Hal Speed, an AMD marketing executive.

"The two important components of AMD Business Class are that it meets both the unique needs of OEMs and the unique needs of system builders," Speed said.

Large computer manufacturers like Hewlett-Packard, Dell, Acer, Lenovo and Fujitsu-Siemens have committed to building Hardcastle-based commercial desktop systems, Speed said. HP on Monday announced two new AMD Business Class models, the HP Compaq dc5850 Business Desktop PC, available worldwide May 5 with a starting U.S. list price of $599, and the HP Compaq dx2450, currently available in North America with a starting US list price of $369. The HP Compaq dx2355 will also be available in the Asia-Pacific market later this quarter.

Dell's first AMD Business Class offering is a refreshed OptiPlex 740, while Fujitsu-Siemens has announced two new products built on the platform, the Esprimo E5625 and the more expensive P5625. Lenovo is preparing the desktop market for its enterprise-class ThinkCentre A61 and more SMB-oriented A61e, and Acer will counter with its Veriton M420.

After reporting another loss in its recent first-quarter earnings call -- AMD's sixth straight quarter in the red -- the chip maker has had to tighten its belt considerably, announcing layoffs to the tune of 10 percent of its workforce by Q3 even as Ruiz has pledged to trim non-core businesses from the company's holdings.

But things might not be as bleak for AMD as they appear, said Dean McCarron, principal analyst at Mercury Research. Winning significant deals with HP and others, despite well-publicized delays for AMD's quad-core server and desktop parts, could go a long way towards turning things around for the beleaguered chip maker, McCarron said.

"We're actually starting to see the very initial phase of acceptance for the AMD-ATI integration. This current launch [of the 780 series chipsets] is the first really integrated product between AMD and ATI. Before, a lot of the integration was really just putting an AMD label on an ATI product. So far, things look like acceptance is going well for the new chipsets," he said.

"We're right in the middle of the Spring refresh design phase and it sounds like they're getting some decent design wins."

HP in particular has been a friend to AMD in tough times. Even as Dell in early February dropped AMD's consumer PCs from its online offerings, HP has been the first among OEM equals in showcasing AMD-based client and server solutions. The HP ProLiant DL385, part of the Palo Alto, Calif.-based computing giant's line of AMD quad-core Opteron servers, recently earned top marks on the SPECweb2005 benchmark for x86 2p servers, highlighting significant strengths in Web-based transactions.

Next: Chipset choice for the channel