Advanced Micro Devices announced during the most recent teleconference with analysts that its Fab 36 had been fully converted to modern process technology and also said that the yield of those products was high enough. However, even though the output of functional code-named Barcelona products was high, the chip requires “more design work”.

“Our Fab 36 conversion to 65nm is complete, with yields exceeding expectations and we now turn all our attention to 45nm [transition],” said Dirk Meyer, the president and chief operating officer at AMD, during the conference call.

Originally the world’s second largest producer of x86 central processing units promised to “substantially” convert its Fab 36 to 65nm production technology by mid-2007, which means that full transition to the new manufacturing tech in the middle of Q3 2007 may be an indicator of execution either ahead, or inline with the original plan. Nevertheless, the company now claims that it will slowdown “the ramp” of Fab 38, or the conversion of Fab 30 that operates 200mm wafers into a 65nm fab that uses 300mm wafers, a move that potentially reduces the amount of central processing units AMD can market.

“Overall as a company, our spending levels will decrease going forward and, as a result of outstanding execution in Fab 36, we see the opportunity to further reduce our CapEx plans by slowing the rate of ramp of Fab 38,” said Robert J. Rivet, chief financial officer of AMD.

On the other hand, with yields exceeding expectations, it can be expected that revenue ramp of AMD’s 65nm products based on the new micro-architecture will also exceed expectations. Unfortunately, Mr. Meyer confirmed earlier rumours that AMD’s quad-core processors need a new revision (a slight redesign) to be able to increase clock-speed rapidly.

“First of all, we’re very happy with our 65nm yields across all products, including Barcelona, so no issue there. The fact of the matter, Barcelona, while being an absolutely great product, is complicated and it’s taking a little bit more design work than we anticipated getting the final rim in place,” said Dirk Meyer.

AMD’s first quad-core AMD Opteron processors code-named Barcelona will be introduced in August or September, but will only run at 2.0GHz, whereas faster parts are projected to become available in Q4 2007.