Transmeta confirms recall of Crusoe chips

By : |November 30, 2000 0

SAN FRANCISCO: Transmeta Corp. confirmed on Wednesday that it is working with
Japanese computer maker NEC Corp. to recall notebook computers built with flawed
versions of its power-saving Crusoe microprocessor.

Transmeta said in a statement that the recall would take in "fewer than
300" NEC computers at risk of failing if the user reinstalled operating
software.

The company said that the recalled Crusoe chips came from a limited
manufacturing batch, and the remaining inventory of the defective chips had been
returned to Transmeta.

                                 

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Shares of Transmeta tumbled 15 per cent to close at $23-13/16 on Nasdaq on
Wednesday after a Japanese newspaper reported that NEC was considering a recall.

In after-hours trade, Transmeta shares extended that slide, taking the
cumulative loss on the day to nearly 25 per cent. The shares last traded on
Instinet at $21.

The stock had surged to $50 on its first day of trading following its highly
anticipated $273 million initial public offering on Nov. 7.

The Crusoe chip, the first designed by Transmeta, uses elaborate software
instructions rather than hardware to perform certain functions, cutting power
consumption.

"Transmeta stands behind the Crusoe and will continue to work with its
customers to insure Crusoe’s quality and reliability," the company
statement said.

Sony Corp., which uses the same Crusoe chip in its notebook PC, has also
reportedly started a probe, according to Japan’s Yomiuri Shimbun.

Neither Sony nor Transmeta could be reached immediately for comment.

Rival Intel Corp. already has chips on the market that consume about the same
amount of power – roughly 1 watt – as the Transmeta chip, which is aimed at
mobile computing and other wireless, handheld devices requiring long battery
life.

(C) Reuters Limited 2000.

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