Soon after the acquisition of ATI, AMD said it would develop a microprocessor that combined a graphics processing unit and CPU on a single chip. Late last year, the company delayed the release of a CPU-GPU chip from 2009 to 2011, citing development concerns and economies of scale.

But the ATI brand won't go away after its operations are merged inside AMD, Prairie said. The company will continue to sell graphics cards under the ATI brand.

AMD also announced that Randy Allen, senior vice president of the computing solutions group, was leaving the company. Allen was previously responsible for AMD's chip products, including microprocessors and platforms.