By Scott Hillis

SAN FRANCISCO (Reuters) - The chief of Advanced Micro Devices Inc said on Monday a new chip with four processing brains would help the underdog company win back market share from rival Intel Corp and does not see any sign consumers are holding back on new computers -- yet.

Chief Executive Hector Ruiz told Reuters in an interview the new processor would strengthen AMD's position in the server market, a key battling ground with rival Intel.

The chip known as Barcelona and launched on Monday, delivers faster performance, is more energy efficient, and makes it easier to run multiple kinds of computer operating software at the same time, a feature known as "virtualization."

AMD has been counting on Barcelona to help it regain share in the $40 billion-a-year market for the x86 processors that power most personal computers.

"The value that Barcelona offers is phenomenal and I feel we have a pricing leadership position in terms of value," Ruiz said. "The mix of products will obviously affect our financial performance positively."

Ruiz, who did not make specific financial forecasts, also addressed broader concerns about the economy during the interview, saying that, so far, consumer spending appeared to be weathering the housing and credit market troubles.

Over the past year, AMD shares have fallen 50 percent, compared with a rise of 30 percent for Intel. AMD stock rose 2.6 percent on Monday to close at $12.94 on the New York Stock Exchange.

"We are not in the business just for the status quo. We have invested and been rewarded with a bigger share as we perform. But we are never satisfied," Ruiz said.

Ruiz also expected demand for personal computers to be strong in the second half and that consumer buying did not yet seem to be affected by widening credit problems in the housing industry.

"I don't know to what extent it will have a spillover effect on consumers," Ruiz said of the wave of defaults on high-risk mortgages that has roiled the U.S. economy. "I think that consumers seem not to be impacted, yet."

Asked about AMD's previous estimates that it could account for 30 percent of processor sales, Ruiz said: "It's true that in a fair and open competitive space, I don't see any reason to limit ourselves to a number. Thirty percent is not only reasonable, but we should surpass it."

The phrase "fair and open" is a reference to AMD's lawsuit against Intel, which AMD charges has violated antitrust laws in the United States and elsewhere.

"My opinion is that our case against them is getting stronger and the chance of other countries getting involved is strong," Ruiz added.
© Copyright 2007 Reuters.

Photo:
Hector Ruiz, chief executive officer of America's Advanced Micro Devices Inc., listens to questions during a news conference in New Delhi November 30, 2005. Ruiz said on Monday a new chip with four processing brains would help the underdog company win back market share from rival Intel Corp and does not see any sign consumers are holding back on new computers -- yet. REUTERS/Kamal Kishore