Neo chips are power-efficient processors designed for sub-notebooks that can deliver full functionality at affordable prices, AMD says. AMD fits Neo into a category of PCs it calls "ultrathin" laptops, which falls between ultraportable and netbook laptops. Ultraportables are too expensive, while netbooks, though cheap, provide limited PC experience, AMD contends.

The dual-core Neo will be part of the Congo platform, and it will deliver better performance and integrated graphics capabilities than its predecessors. The single-core Neo is used by Hewlett-Packard in its Pavilion dv2 laptop, which has a 12.1-inch screen and is priced at US$750.

The updated Neo chips could potentially face competition from Intel's upcoming low-power processors -- also called CULV processors -- which could be launched later this quarter. Dodging questions about how the Neo chips will compete against CULV processors, AMD CEO Dirk Meyer said the company has many design wins around Neo and is happy with the way chip development is progressing.