Advanced Micro Devices on Friday said it would take charges totaling $948 million in the second quarter, with most of the money related to the 2006 acquisition of graphics chipmaker ATI Technologies.

In , AMD said the ATI-related charges amounted to $880 million for good will and intangible asset impairment.

The remaining charges included $32 million stemming from recent layoffs at the company. AMD, which reported in April a $358 million loss in the first quarter, has been conducting layoffs and other aggressive cost-cutting measures to break even by the end of the year. on softer-than-expected demand for its products because of a slowdown in consumer spending.

In addition to the layoff charges, AMD reported to the SEC plans to take a charge of $36 million for the impairment of certain short-term assets. The company also said it expected to record a gain from the sales of wafer fabrication tools used in manufacturing. AMD estimates the sales will have a "materially favorable impact" of $190 million on the chipmaker's gross margin.

AMD is scheduled to release second-quarter financial results July 17.

AMD in the first quarter started volume shipments of its quad-core processors, which had been code-named Barcelona, and launched quad-core and triple-core Phenom processors for desktops. The company also launched a graphics for motherboards and an updated line of ATI Radeon graphics cards. The company also demonstrated its first 45-nanometer quad-core processors for servers and desktops, which it expects to ship in volume by the fourth quarter.

In the second quarter, AMD released its first , the fastest growing segment of the PC market. AMD had lagged behind rival Intel in this all-important market.

With the recent releases, some analysts believe AMD's current product line is a strong competitor to the larger Intel.