Intel has announced a management shake-up in the latest move to restructure the world’s largest chipmaker and improve performance.

The news came a day after Intel reported its worst quarter in years, with sales falling 13 per cent and the company saying it would miss its revenue target for 2006.

Its shares fell 7.5 per cent on Thursday on the news while those of its biggest rival, Advanced Micro Devices, were down nearly 6 per cent in after-hours trading after it reported second-quarter sales had been hurt by price competition with Intel.

AMD said sales were $1.22bn, down from $1.26bn a year ago. Profits were higher at $88.8m, or 18 cents per share, up from $11.3m, or 3 cents, last year.

Paul Otellini, Intel’s chief executive, said on Thursday he was changing its traditional management structure at the top level , where “two-in-a-box” co-managers often share responsibility.

Sean Maloney, one of two deputies to Mr Otellini as executive vice-president, is being moved from co-manager of the Mobility group, responsible for notebook computer chips, to be head of sales and marketing.

Mr Maloney, 50, and originally from the UK, is joined by another Briton, Don MacDonald, who becomes vice-president of marketing and brands. He was previously head of the Digital Home division, formed last year.

David Perlmutter will now be the sole head of the Mobility group.

Anand Chandrasekher, formerly co-manager of sales and marketing, will manage a new unit focused on low-power processors and a new market Intel is developing for the “ultra-mobile PC”.

Eric Kim, who joined Intel from Samsung, is moving from co-head of sales and marketing to be head of the Digital Home group.

William Siu, a 26-year veteran, who headed the Channel Platforms group and Richard Wirt, 25 years with Intel and co-manager of software and solutions, both announced their retirement.

“The moves announced today will help us speed decision-making and bring new resources to bear in critical areas, while allowing me to spend more time on key strategic issues,” said Mr Otellini.

A strategic review started in April has resulted in the sale of Intel’s business of making chips for mobile phones and the axeing of 1,000 managers.

Andy Bryant, Intel’s other executive vice-president and chief financial officer, said the next two months would see spending and headcount reduced further.

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