Number two chip maker AMD says that it will release true quad-core processors by mid-2007, distinguishing the chips from the packaged two dual core design that Intel has announced will be released this year.

In the interim, AMD will also release a two dual-core package before the end of the year.

AMD fared better than Intel in the immediately preceding quarter, with net income of $89 million, up from $11 million a year earlier. By comparison Intel suffered a 57% earnings plunge of US$1.19 billion to just US$885 million for the quarter.

However, Intel has just released its new range of dual-core desktop, server and high performance computing processors, which out perform the current generation AMD offerings.

This is expected to boost Intel's sales in the coming quarter and put a damper on AMD further eating into Intel's market share.

AMD now has more than 20% of the processor market and has predicted it will have 30% by 2008. Meanwhile, Intel is going through a major cost cutting exercise and could shed up to 15,000 staff. {moscomment}