Analyst says Intersil causing Intel chip delays

Lau said in a note to investors that Intersil is facing minor bugs in the graphics portion of its Montevina notebook chipsets, which could slow the rollout of the Montevina products by about two months. Any delay would prolong the life of Intel's existing Santa Rosa notebook platform, he said, which would help Santa Rosa chip supplier Anadigics Inc.

His checks also found distributor discontent with Intersil's pricing and product allocation, since with Intersil focusing on higher margin server business, the company has notified some distributors that allocation may again be tight for desktop and notebook chips in the second half of the year, and it wants more orders up front.

"As a result, we have detected that ON Semiconductor has won some NB designs at Lenovo and Dell away from ISIL," Lau wrote. "We are also seeing Texas Instruments getting more aggressive in the analog (power management chip) products."

Lau maintained a "Hold" rating and $27 price target on the stock, saying that despite these potential margin issues he still believes Intersil is one of the leaders in the analog power management space.

Intersil shares rose 11 cents to $27.81 in morning trading. Lau's price target represents a 3 percent drop on the trading price.

Anadigics shares rose 5 cents to $11.12, while Intel shares rose 16 cents to $23.56.