Transmeta Gets $7.5 Million Infusion From AMD

Transmeta, the once-high flying chip maker that boasted Linux kernel creator Linus Torvalds as a staffer but has since fallen on hard times, got a $7.5 million boost from AMD today.

As part of the deal, AMD  invested $7.5 million in Transmeta  in exchange for Transmeta preferred stock. Transmeta did not disclose what it will do with the money, and AMD did not explain why it made the investment.

A statement from Les Crudele, president and chief executive officer of Transmeta, did shed a bit of light on the investment.

“AMD has long been a leader in the development and delivery of energy-efficient, high-performance computing technologies, standards and initiatives,” said Crudele. “Transmeta has been proud to endorse and contribute to those industry leading activities, and we look forward to continuing our collaboration with AMD on technology initiatives in the future.”

Dirk Meyer, president and chief operating officer of AMD, added, “Our investment will support Transmeta’s technology development work and AMD’s efforts to leverage Transmeta’s innovative energy-efficient technologies to the benefit of AMD’s customers.”

Part of the reason for the investment could be a continuation of a deal announced in June 2006, where AMD bought Transmeta’s Efficeon processor for use in desktop computers intended for emerging markets. The forthcoming Efficeon-based, FlexGo PCs are pay-as-you-go systems that require a small initial down payment.

Transmeta certainly could use the money. Other than suing Intel, Transmeta hasn’t made much news, or generated much revenue. In May, the company reported $2.1 million in quarterly revenue, versus $19.5 million in revenue in the first quarter of 2006. The chip company reported a Q1 2007 loss of $18.7 million, compared with a loss of $1.6 million in 2006.

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