AMD to outsource more chips to TSMC

Advanced Micro Devices Inc (AMD), the world's second-largest maker of computer processors, will give more orders to Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to meet demand for graphics chips.

"We're going to expand our partnership with TSMC just because we've got a lot of ambitions" for the company's graphics chip business, Henri Richard, AMD's chief of sales, said in an interview on Wednesday in Taipei.

He didn't provide details on the size of the additional orders.

AMD, based in Sunnyvale, California, last year bought ATI Technologies Inc to expand beyond processors and bolster its graphics-chip operations.

The company has already outsourced some production of the chips to TSMC, the world's largest custom chipmaker.

"Over the last couple of years ATI has lost ground" and we want to regain that, Richard said.

"I see no way but up for the TSMC relationship," he said.

The graphics chips to be made by TSMC will be used in mobile phones, digital televisions and set-top boxes, said Phil Hester, AMD's chief technology officer, in an interview on Thursday, also in Taipei.

AMD, which trails Intel Corp in making personal computer microprocessors, will provide details next month on its plan to develop graphics and processor capabilities on the same chip, a technology it has labeled Fusion, Hester said.

Hester and Richard declined to say if the company will outsource production of processor chips to TSMC or smaller rival United Microelectronics Corp (UMC, 聯電), in addition to current orders given to Singapore-based Chartered Semiconductor Manufacturing Ltd (特許).

TSMC said yesterday it posted sales of NT$25.71 billion (US$779 million) for May, up 11.3 percent from NT$23.09 billion in April.

In the first five months of the year, sales amounted to NT$113.70 billion, down 14.1 percent from the year-earlier period, the world's largest wafer foundry said.

UMC, meanwhile, said yesterday sales in May rose 1.1 percent to NT$8.22 billion (US$249 million) from NT$8.13 billion in April.

However, the May figures were down 3.34 percent year-on-year, the company said.

Sales for the first five months of the year fell to NT$39.38 billion from NT$41.35 billion in the same period a year earlier, the world's second-largest wafer foundry said.