AMD’s acquisition of NexGen

On January 16, 1996, AMD closed on its acquisition of NexGen. It was a transformational purchase for AMD, as it gave them a way ahead after AMD’s own design team struggled to create a viable competitor for Intel’s Pentium CPU. NexGen had been the first company to produce a Pentium-class CPU outside of Intel.

Why AMD acquired NexGen

NexGen Nx586 CPU
NexGen’s Nx586 was the first non-Intel Pentium-class CPU on the market. AMD used NexGen’s technology to build its K6 and later CPUs.

In 1995, when its competitor to Intel’s Pentium was late, AMD entered an agreement to purchase competitor NexGen after Bill Gates introduced NexGen’s CEO, Atiq Raza, to AMD CEO Jerry Sanders. AMD used NexGen’s technology for subsequent CPUs. The AMD K6 and K6-2 CPUs, based on NexGen technology, kept AMD in the game with a Socket 7 CPU that could compete with Intel’s low-end and midrange CPUs while costing less.

Its successor, 1999’s Athlon CPU, saw AMD challenging Intel at the high end of the product sector for the first time. AMD’s net sales jumped from $2.5 billion in 1998 to $4.6 billion by 2000 on the strength of the Athlon. The Athlon 64 CPU of 2003 took things a step further. It extended the x86 to 64 bits, and forced Intel to clone AMD.

Without NexGen, AMD likely would have gone the way of Cyrix or other 1990s Intel competitors. Whatever K5 successor they came up with could very well have ended up like the VIA Cyrix III.

What was NexGen?

NexGen was founded July 31, 1986 by Thampy Thomas, with funding provided by Compaq, ASCII and Kleiner Perkins. It set about producing a competitor for Intel’s 386, but the design was late, only ready after the industry had moved on to the 486 generation. Compaq was fond of funding potential second sources to foster competition. Hard drive maker Conner Peripherals was an example of another startup Compaq funded in its early days.

The Nx586 CPU

Unlike AMD and Cyrix, NexGen skipped the 486 generation and went straight to a 5th-generation design. This chip, the Nx586 CPU, was introduced in 1994, and was the first CPU to attempt to compete directly against Intel’s Pentium. It was the first x86 CPU to use RISC-like instructions internally and translate x86 CISC instructions into those simpler RISC instructions for execution.

Unlike competing chips from AMD and Cyrix, the Nx586 was not pin-compatible with the Pentium or any other Intel chip. Instead, it required its own custom NxVL-based motherboard and chipset. NexGen offered both a VLB and a PCI motherboard for the Nx586 chips. NexGen did not have its own fabrication plants and relied on IBM for production.

Like later Pentium-class CPUs from AMD and Cyrix, the Nx586 was more efficient clock for clock than the Pentium. Its P80 variant ran at 75 MHz and its P90 variant ran at 83.3 MHz. Unfortunately for NexGen, this proved to be a moving target. Improvements included in Intel’s first Triton chipset increased the Pentium’s performance relative to the Nx586, making the Nx586 no longer as fast as an Intel Pentium running at 90 MHz.

Making matters worse, PCs identified the Nx586 as an 80386 processor. This led many applications that require a processor faster than a 386 to refuse to run.

Unlike the Pentium, the first Nx586 had no built-in math coprocessor. An optional Nx587 provided this functionality, much like 386-era CPUs. Later Nx586s included an x87 math coprocessor on-chip. Using IBM’s multichip module (MCM) technology, NexGen combined the 586 and 587 die in a single package. NexGen called the new device the Nx586-PF100 to distinguish it from the FPU-less Nx586-P100. It used the same pinout as the earlier Nx586.

The Nx586 is rarer today than other Pentium clone CPUs because it didn’t sell as well. Its historical significance lies in what it became rather than what it was on its own.

Who used the Nx586?

In the wake of the Intel FDIV bug, Compaq announced it intended to use the Nx586 and even struck the name “Pentium” from its product literature, demos, and boxes. Instead, it said it used “586” CPUs. But Compaq never used NexGen’s chip widely. Instead, Alaris, Inc., a smaller computer systems maker, became the first company to ship a computer with the Nx586 in fall 1994.

AMD purchased NexGen when AMD’s K5 chip failed to meet performance and sales expectations. But AMD didn’t want the Nx586 so much as they wanted the design team and the next chip they were working on. AMD quickly wound down the Nx586, even giving some NexGen customers free AMD K5 CPUs with motherboards in exchange for sending in their NexGen hardware.

AMD halted development of its internal K5 successor in favor of continuing from NexGen’s Nx686 designs. The Nx686 became the very successful AMD K6.

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4 thoughts on “AMD’s acquisition of NexGen

  • January 15, 2025 at 1:16 pm
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    I remember reading about these in PC Mag when they came out. They seemed promising. I only ever saw set of CPU/motherboard for sale in a used section at an old computer store back in 1995 or 1996. Theyre quite pricey on ebay when they do pop up.

    • January 17, 2025 at 5:40 pm
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      I’ve had someone ask me if I ever saw an Nx586 myself with my own eyes in the wild. I don’t think I have. I read about it, saw the ads, and was certainly interested in it, but AMD bought NexGen pretty fast. By the time I was in the market for a Pentium-class motherboard and CPU, NexGen was gone from the market.

  • January 15, 2025 at 10:07 pm
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    was Athlon CPU based on the current NexGen ip?
    was Athlon CPU NexGen Nx686 or Nx786

    • January 17, 2025 at 5:46 pm
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      As far as I know, yes, AMD continued to use the NexGen IP on subsequent CPUs, integrating NexGen’s engineers with some of its own. The Nx686, which NexGen was designing when AMD bought them, became the AMD K6. I don’t have any insight into how far along the Athlon would have been circa 1995 though, that chip was still several years off.

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