Advanced Micro Devices plans to cancel introduction of dual-core AMD Phenom microprocessors based on its latest generation K10 micro-architecture and made using current process technology. The reasons for the decision are not completely clear, but it is highly likely that the company decided to reduce its development costs amid uncertain profitability of such chips.

A news-story published by HKEPC web-site claims that AMD had informed its partners among mainboard makers that it had cancelled plans to release dual-core AMD Phenom code-named Kuma microprocessor based on K10 micro-architecture. The company reportedly indicated that dual-core chips featuring the latest design would be made using 45nm process technology, which will emerge late in 2008.

The code-named Kuma chips would be able to improve competitive positions of AMD’s dual-core lineup, however, potential difficulties with increasing clock-speeds of dual-core K10 might lead to decision to cancel the product. As a result, AMD will have to keep supplying aging K8 micro-architecture powered AMD Athlon 64 X2 chips, which first emerged on the market back in 2005, for many months from now.

At present AMD’s product lineup seems to be considerable weaker compared to that of Intel Corp., primarily due to relatively low performance of higher-end models and inability to compete for the market of most expensive microprocessors. While more competitive dual-core offerings would boost AMD’s product family, this could not improve the company’s financial results substantially.

AMD did not comment on the news-story.