Intel says Nehalem chips on track for '08 2nd half

SAN FRANCISCO, May 21 (Reuters) - Intel Corp INTC.O is on track to ship its next generation of computer processors, code-named Nehalem, in the second half of this year, Chief Executive Paul Otellini said on Wednesday.

“Nehalem ... is still scheduled to launch in the second half of the year,” Otellini told the company’s annual meeting of shareholders.

He also confirmed plans to quickly increase output of computer processors made with the latest technology, which can etch circuits 45 nanometers wide, 30 percent smaller than previous chips using a 65-nanometer process.

“On 45 nanometers, Intel is leading the industry by a long stretch,” Otellini said. “We are on track to cross over in (the third quarter) of this year, so more than half our processors will be made on 45 nanometers.”

(Reporting by Scott Hillis; editing by John Wallace)

((; +1 415 677 2505; Reuters Messaging: Keywords: INTEL/CHIPS

C Reuters 2008. All rights reserved. Republication or redistribution ofReuters content, including by caching, framing or similar means, is expresslyprohibited without the prior written consent of Reuters. Reuters and the Reuterssphere logo are registered trademarks and trademarks of the Reuters group ofcompanies around the world.nN21409393