Stephen Shankland/CNET

Intel Chief Executive Paul Otellini slammed Windows 8 during a meeting with employees in Taiwan, according to a Bloomberg report, saying the operating system still has bugs and is being released before it's ready.

Otellini said Windows still needs some improvements, according to Bloomberg. But Otellini also said releasing Windows 8 before it's completely ready is the correct decision to help Microsoft and the PC makers compete against Apple during the key holiday season. He added that Microsoft can make changes after Windows 8 ships, the report said.

Josh Long/CNET

Microsoft and Intel have been close partners over the years, but their relationship has been strained during Microsoft's development of Windows 8, which will be Microsoft's first version of Windows to run on an ARM Holdings architecture, not just the x86 architecture from Intel and AMD that dominates PCs.

Windows RT, the ARM-based version of the operating system, has faced some setbacks of late, with some companies, such as Toshiba and H-P, scrapping plans for such devices. Windows 8, meanwhile, has largely appeared to be on track. Intel has touted various tablet and notebook design wins with the software, and it plans to host a tablet event Thursday in San Francisco.

An Intel spokesman on Tuesday said in a statement that internal employee meetings are private, and Intel doesn't disclose what may or may not have been said.

"We continue to see Windows 8 as a significant opportunity across the board and are excited at our prospects in new form factors like Ultrabooks, tablets and convertibles," the spokesman said.

Microsoft, which plans to release Windows 8 on Oct. 26, said in a statement that it's looking forward to making the operating system available next month.

"With over 16 million active preview participants, Windows 8 is the most tested, reviewed and ready operating system in Microsoft's history," a spokeswoman said.

Updates at 2:15 p.m. PT with comments from Microsoft.