AMD Drops Price of High-End Desktop Processors

Advanced Micro Devices on Wednesday quietly lowered the price of two high-end Phenom II quad-core desktop processors, a move that came a couple of days after Intel slashed prices on a variety of chips. The new prices for the 3.0-GHz Phenom II 940 Black Edition and the 2.8-GHz Phenom II 920 were cut $50 and $40 to $225 and $195, respectively, a company spokesman told InformationWeek. AMD planned to make an official announcement in a day or two.

In the meantime, both chips were available at a lower price as of Wednesday through online retailer Newegg, which was selling the Phenom II 940 for $235 and the 920 for $195.

AMD lowered the prices in response to the economic slowdown and also to make room for new chips scheduled to ship next month, the spokesman said. While declining to provide details, the upcoming products will be available with AMD's new AM3 chipset, which supports DDR3 memory. AMD currently offers the AM2+ chipset that supports the slower DDR2 memory. The price cuts come as Intel lowered prices on some of its quad-core desktop and Xeon server processors by as much as 40%. Besides the fierce competition between the two rivals, both companies appear to be responding to a down market brought on by the economic slowdown.

AMD is scheduled to report quarterly earnings on Thursday. Intel last week reported that net income plummeted by 90% and revenue fell 23% in the final quarter of last year, as the chipmaker felt the effects of an economic recession that has resulted in a drop in PC sales. Global PC sales in the fourth quarter fell for the first time in six years, according to researcher IDC. Shipments dropped 0.4% from a year ago and 2.5% from the third quarter. The decline followed a half-dozen years of rising shipments, with the last five averaging increases of 15%.