updated 1/22/2007 8:12:29 AM ET 2007-01-22T13:12:29

Server and software maker Sun Microsystems Inc. has agreed to use chips from Intel Corp. in some of its servers and for Intel to endorse Sun’s Solaris operating system, a person close to the deal told the AP late Sunday night.

An announcement is expected Monday, according to the person, who requested anonymity because the deal had not been made public. Specifics of the deal were not disclosed.

The deal marks a major design win for Intel, the world’s largest computer chip maker, which has been fighting to reverse plunging profits and regain market share lost to archrival Advanced Micro Devices Inc.

Intel began losing ground to AMD several years ago as customers began migrating to AMD-designed chips that were seen as more energy-efficient.

Since 2003, Sun has relied exclusively on AMD to supply server chips based on the popular x86 microarchitecture, or design, used in many personal computers and servers.

Sun will still use AMD chips in some of its products, the person close to the deal said. Sun also makes its own line of Sparc branded processors.

Last year, after losing more than 5 percent of the overall computer chip market to AMD, Intel unveiled a new line of chips based on an upgraded design that industry observers cheered for delivering higher performance while giving off less heat.

Intel’s endorsement of Sun’s Solaris operating system is also an important victory for Sun, as many servers that use chips based on the x86 design often run on Linux or Microsoft Corp.’s Windows operating system.

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