Intel Corp. on Monday began what it hopes will be a comeback after months of market share losses and weakness on Wall Street by shipping a new low-power, high-performance microprocessor designed to blunt the inroads that challenger Advanced Micro Devices Inc. has been making in selling the silicon brains for business and personal computers.

Although Intel remains profitable and still dominates the microprocessor industry, AMD has gained market share in the last two years by selling chips that have out-performed Intel products in key segments such as servers, the powerful machines that run networks or do intensive number-crunching.

AMD's gains have battered Intel shares and shaken its management. To stem this tide, Intel Chief Executive Officer Paul Otellini recently promised investors a "very aggressive" response to AMD's challenge. Monday's announcement, the first in a series of product upgrades Otellini promised, began where AMD's gains have been most-pronounced -- in the market for servers.

"We're back," Intel Vice President Tom Kilroy said Monday at a news conference in San Francisco where he announced that 150 computer-makers are already using the company's new Xeon 5100 microprocessor.

According to market research firm Gartner Group, since the first quarter of 2004 AMD has surged from 3.5 percent of the worldwide server microprocessor market to 14.3 percent, while Intel's share has shrunk from 88.3 percent to 79.5 percent, with the balance divided among distant laggards, notably IBM. Analysts say one reason for AMD's gain was that it anticipated that electrical power consumption had become a driving concern in large data centers and responded with server chips that offered high performance at a lower power drain.

Gartner microprocessor analyst Martin Reynolds said the new Xeon 5100 was an impressive comeback for Intel after lagging AMD's offerings in this high-end segment.

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