The improvement should also make it easier for Intel to take advantage of faster memory technologies like DDR3, McGregor said. Compared to existing DDR2-capable processors, the new DDR3-capable Xeon chips will be able to talk to memory quicker, leading to improved system performance.
Another significant technology advancement is the addition of the QuickPath Interconnect (QPI) technology, a point-to-point interconnect that provides the CPU with a faster pipe to communicate with other processors and system components, the analysts said.
QPI removes some old bottlenecks of Intel's earlier chip microarchitectures to improve system speed and performance per watt, Gabriel's Olds said. As cores are added, QPI will help servers execute more tasks in parallel and tackle larger workloads and more data-intensive applications that need a lot of bandwidth and processing power.
The benefits are not on the hardware side alone -- the chips will be able to execute more tasks than earlier Xeon processors while drawing less power, which could help cut energy costs. A larger number of cores should help consolidate servers into a smaller space in data centers.
Despite the new features, the chip may struggle to find buyers immediately as organizations cut back on IT spending during the recession.
"In the current economic environment, people will not go out and upgrade because it's a cool new thing," Olds said.
However, the new chips will generate a good margin for Intel and perhaps push the company into new markets like high-performance computing, analysts said.
The eight-core chip, code-named Nehalem-EX, will be able to run data-intensive applications like scientific and technical workloads, In-Stat's McGregor said. The chips have enough bandwidth and processing power to execute a larger number of tasks in parallel than typical quad-core Xeon chips, which are designed to tackle less-demanding applications like databases.
"As you're getting into more high-performance applications, you need the core count and the applications designed to use them," McGregor said.
Going into six or eight cores for Nehalem chips is a double-edged sword, though, Olds said. Effective use of the cores depends on whether the software is designed to execute the tasks simultaneously across a larger number of cores. Applications need to be broken down into little pieces for distribution over multiple cores for parallel execution, which can be difficult.
But that's not a huge concern, and the addition of cores should spur independent software vendors to write software for parallel execution, Olds said.
Intel started talking about Nehalem chips in 2007. It launched the first Nehalem-based chip, the Core i7, for high-end desktops in November.