Intel Corporation Class Action Lawsuit - 7nm Woes

FrgMstr

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The Intel class action lawsuit alleges that during the Class Period, defendants misrepresented Intel’s business and financial condition by issuing false and misleading statements and/or failing to disclose adverse information regarding Intel’s financial performance and, in particular, the current performance and production status of its 10-nanometer (“10nm”) and new generation 7-nanometer (“7nm”) products. Specifically, defendants failed to disclose that: (a) Intel’s 7nm processor scheduled for release in 2021 was not on track, but rather, was suffering from material production and yield defects that threatened the 2021 delivery and timing of the product and Intel’s overall product roadmap; (b) Intel’s gross margins and fiscal 2020 outlook had been adversely impacted and would continue to be adversely impacted by continued acceleration of 10nm production and simultaneous 7nm technology development problems; and (c) because of the ongoing process and production defects of the 7nm products, Intel was considering material changes to its manufacturing protocols to include third-party foundries – a process that Intel had long resisted. As a result this information being withheld from the market, Intel securities traded at artificially inflated prices during the Class Period, with the price of Intel’s stock reaching a high of $64.34 per share.

On June 11, 2020, Intel announced the resignation of Senior Vice President Jim Keller (who had been hired in 2018 to take over and lead Intel’s stumbling process and chip development group). On this news, the price of Intel stock declined nearly 7%. Then on July 23, 2020, after the market closed, Intel announced its second quarter 2020 financial results. Despite impressive revenue and earnings results, Intel disclosed that it was further accelerating its transition to 10nm products and, more importantly, that production and development of its 7nm products was 12 months behind schedule. As a result of these disclosures, Intel’s share price declined approximately 16%, from a close of $60.40 per share on July 23, 2020 to a close of $50.59 per share on July 24, 2020.


https://www.rgrdlaw.com/cases-intel-corporation-class-action-lawsuit.html
 

Zarathustra[H]

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Never a good time when your shareholders are suing you.

I always wondered how Intel's stock performance continued so strong during a period when everyone with our tech interests knew they had potentially fatal 10nm (and now 7nm?) production problems.

I guess now we know. They were not being forthcoming with shareholders.

Fiduciary responsibility and all that...
 

-Strelok-

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Never a good time when your shareholders are suing you.

I always wondered how Intel's stock performance continued so strong during a period when everyone with our tech interests knew they had potentially fatal 10nm (and now 7nm?) production problems.

I guess now we know. They were not being forthcoming with shareholders.

Fiduciary responsibility and all that...
They are still selling a ton and have revenues/income much higher than AMD. At this point I think it’s just incompetence at Intel, and I think even they didn’t realize just how far behind they were with 7/10nm.
 

Lakados

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They are still selling a ton and have revenues/income much higher than AMD. At this point I think it’s just incompetence at Intel, and I think even they didn’t realize just how far behind they were with 7/10nm.
I’m not sure if incompetence is quite right but I bet they have a ton of engineers crapping their pants. This is a management bungle, bunch of people trying to cover their asses submitting more sunshine than content in their memo’s up the chain. I honestly doubt that Intel’s top end has any clue what’s actually going on below the decks.
 

Zarathustra[H]

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They are still selling a ton and have revenues/income much higher than AMD. At this point I think it’s just incompetence at Intel, and I think even they didn’t realize just how far behind they were with 7/10nm.

Of course they have much greater revenues than AMD. T hey are a MUCH larger company. They also have much greater costs than AMD.
 

Zarathustra[H]

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It's kind of sad to see how the might have fallen.

There was a time not that long ago that Intel had the unquestionably best fabs on the planet.

Makes you wonder how tenuous continued success at Samsung and TSMC is and if we are just one bad node shrink away from a single player monopoly on the smallest node sizes, which would be terrible for everyone involved.

I have definitely not been Intel's biggest fan over the years, turned off by their lawsuit trolling, and unethical business practices, but I hope for the sake of continued success of the market as a whole they can recover and kick their fabs back into gear. If 7nm is also in as much trouble as 10nm was that's missing two generations in a row in a highly continuous improvement based industry, where the successes on one node are carried forward as lessons learned to the next. Losing two nodes in a row may be more than a company can handle...
 

MrGuvernment

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If you want to know how Intel is making money just think data centers....Who do you think is powering all those AWS / Azure and Google Data centers? Intel most likely....not AMD...
 

Zarathustra[H]

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If you want to know how Intel is making money just think data centers....Who do you think is powering all those AWS / Azure and Google Data centers? Intel most likely....not AMD...

From what I have been reading, AMD is picking up in those settings.

And a lot of datacenter users (especially Amazon) are starting to get really into ARM64 in large volumes.
 

UnknownSouljer

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Yup. I expect that ARM is going to take over the massive server market - especially for those organizations that can literally afford to design their ARM chips. This level of specialization and customization isn't possible in x86. And ARM can do all of those server work loads, faster, cheaper, and more efficiently for a lower cost and higher density when specialized to do so.
 

Zarathustra[H]

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Yup. I expect that ARM is going to take over the massive server market - especially for those organizations that can literally afford to design their ARM chips. This level of specialization and customization isn't possible in x86. And ARM can do all of those server work loads, faster, cheaper, and more efficiently for a lower cost and higher density when specialized to do so.

I don't think ARM will take over the enterprise server market, but I do think it will become a major player and a viable alternative for many things.
 

UnknownSouljer

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I don't think ARM will take over the enterprise server market, but I do think it will become a major player and a viable alternative for many things.
I think they're more or less poised to. Cost to running these servers and density counts for a lot. Intel hasn't made a better server chip in at least 3 years and as another thread here in the news section brought up, they're having hard delays on new processor tech moving forward. AMD has lot of work to do to make the inroads - but even if they become the preferred server brand, they don't have the capacity to serve the entire market.

So, Intel's stagnation versus ARM's specialization, density, cost, and power savings? I think the writing is on the wall if Intel sits on its hands like they have been for a good long while.
 

FrgMstr

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I don't think ARM will take over the enterprise server market, but I do think it will become a major player and a viable alternative for many things.
Did you see the Nuvia ARM CPU numbers? If they even get close to what they showed off, it is literally a world changer in terms of datacenter.
 

Zarathustra[H]

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Did you see the Nuvia ARM CPU numbers? If they even get close to what they showed off, it is literally a world changer in terms of datacenter.

I did not. I'll have to google them. Last reviews I saw on this were Amazon Graviton2, and before that Cavium ThunderX2. They both seemed OK, but not revolutionary.
 

Lakados

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Did you see the Nuvia ARM CPU numbers? If they even get close to what they showed off, it is literally a world changer in terms of datacenter.
Their performance per watt is super impressive, it will be very interesting to see what they actually make of it.
 

Zarathustra[H]

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Impressive.

I guess time will tell if their predictions come true (and if Geekbench really is all that good of a performance predictor).

The reason I am a bit apprehensive about jumping head first into this is because of the forum conversations I have had with people actually trying to work with ARM64 based server systems.

The Proxmox devleopment team - for instance - when quizzed about why they have not released a ARM64 version yet, said that they have a build ready to go, but have not been able to find a system up to their performance expectations to validate on.

They apparently tried a Cavium (now Marvell) ThunderX2 server a while back, but found that despite the impressive benchmark numbers it posted all over the internet about 2 years ago when everyone (servethehome anandtech, etc.) was hyping it, in real world testing they found the performance to be very disappointing (especially kernel compiles) and had serious difficulties getting installers to work properly with its weird boot system.

I realize ARM is starting to play in places it hasn't previously, and that it may start making inroads in certain applications, but the ThunderX2 certainly wasn't ready despite fancy benchmark numbers, and it makes me suspicious of these other implementations as well.
 

-Strelok-

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It's kind of sad to see how the might have fallen.

There was a time not that long ago that Intel had the unquestionably best fabs on the planet.

Makes you wonder how tenuous continued success at Samsung and TSMC is and if we are just one bad node shrink away from a single player monopoly on the smallest node sizes, which would be terrible for everyone involved.

I have definitely not been Intel's biggest fan over the years, turned off by their lawsuit trolling, and unethical business practices, but I hope for the sake of continued success of the market as a whole they can recover and kick their fabs back into gear. If 7nm is also in as much trouble as 10nm was that's missing two generations in a row in a highly continuous improvement based industry, where the successes on one node are carried forward as lessons learned to the next. Losing two nodes in a row may be more than a company can handle...
That's what happens when you fire your talent and focus bullshit nonsense like diversity. I haven't seen AMD push any of that, at least not to the degree Intel did and yet they have woman CEO and a good amount of minorities in high positions. Funny how that works.
 

toast0

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I always wondered how Intel's stock performance continued so strong during a period when everyone with our tech interests knew they had potentially fatal 10nm (and now 7nm?) production problems.

My father in law called me about two months ago asking if I knew anything about Intel's new processor and wasn't it going to be great, and shouldn't he invest. Not sure where he heard that from, but there's clearly some weird information circulating around.
 

KarateBob

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My father in law called me about two months ago asking if I knew anything about Intel's new processor and wasn't it going to be great, and shouldn't he invest. Not sure where he heard that from, but there's clearly some weird information circulating around.
I wonder what info your FiL is gettin, stonks don't make any sense to me

1605908036956.png
 
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I’m not sure if incompetence is quite right but I bet they have a ton of engineers crapping their pants. This is a management bungle, bunch of people trying to cover their asses submitting more sunshine than content in their memo’s up the chain. I honestly doubt that Intel’s top end has any clue what’s actually going on below the decks.
Incompetence generally only applies to management types so the statement is accurate.
 

-Strelok-

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No, not really. Lying to your stockholders and throwing dice are not the same thing.
Who lied though? If management knew it was going to be delayed as much as it has, then yes they should pay massive fines. If the middle management who reports to them knew but gave false information then they weren’t technically lying. Either way, incompetence to the highest degree at Intel.
 

FrgMstr

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Who lied though? If management knew it was going to be delayed as much as it has, then yes they should pay massive fines. If the middle management who reports to them knew but gave false information then they weren’t technically lying. Either way, incompetence to the highest degree at Intel.
Guess we will see what the lawsuit finds eh? I am not saying anyone did anything. Simply pointing out that his comparison is terrible misplaced.
 

whateverer

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From what I have been reading, AMD is picking up in those settings.

And a lot of datacenter users (especially Amazon) are starting to get really into ARM64 in large volumes.


Right, and half of the Google data-center workload is using their own Tensors (instead of Intel's Deep-learning extensions). I'm sure the processors feeding those things are also perfectly capable of being non-x86.

There are a lot of furue threats that Intel is going to lose noticeable market share to, but it's not happening today. I would expect another 3-4 years before Intel starts it's sales decline (right now, they are still selling every CPU they fab, so it's going to take awhile before that excess demand fades-away.)
 

Zarathustra[H]

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Right, and half of the Google data-center workload is using their own Tensors (instead of Intel's Deep-learning extensions). I'm sure the processors feeding those things are also perfectly capable of being non-x86.

There are a lot of furue threats that Intel is going to lose noticeable market share to, but it's not happening today. I would expect another 3-4 years before Intel starts it's sales decline (right now, they are still selling every CPU they fab, so it's going to take awhile before that excess demand fades-away.)

Lets keep in mind that in a growing market (enterprise server / cloud seems to just keep growing and growing) it is possible to grow both sales and revenue, while losing market share.

Intel will certainly be less dominant over the next 10 years compared to the past 20, but I suggest the rumors of their demise are greatly exaggerated.
 

GoodBoy

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That's what happens when you fire your talent and focus bullshit nonsense like diversity. I haven't seen AMD push any of that, at least not to the degree Intel did and yet they have woman CEO and a good amount of minorities in high positions. Funny how that works.
diversity didn't cause this...

They got complacent due to incompetence, AMD's clusterfuck with bulldozer, and their own success. Last time AMD was on top, Intel came out with Core i7 and it demolished AMD. Seems whoever is in charge now can't find their ass with either hand, or something major has happened with their engineering and R&D. I don't know what it was exactly, but several years later and shit is still a clusterfuck. 5 years from now if this shit hasn't turned around, I think they really will start losing datacenter revenue in a big enough way they will become irrelevant. Then in 2033 they can pull what AMD is doing to them now, if Nvidia hasn't beaten them both into submission by then. Who knows, in 12 years we might be arguing about whether Nvidia's 0.5nm process (Their own fabs, they get into the Fab business) is better than TSMC's 0.52nm process. The oculus vr implant will be all the rage for gaming, movies, videocalls, and LCD's will be antiquated.
 

tangoseal

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This is nothing...

Bad airbags kill

Cheaper to pay class action for 10,000 victims than recall 2,000,000 airbags

Intel will write this off as pocket change expenses
 

Joust

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This is nothing...

Bad airbags kill

Cheaper to pay class action for 10,000 victims than recall 2,000,000 airbags

Intel will write this off as pocket change expenses

Yeah, but it's not like they produced millions of bad airbags. They allegedly materially misrepresented an outlook to investors with the intent of inflating stock price. So, they said they have a new, better airbag on the way in the near term - when in fact they were having manufacturing difficulties and were far behind schedule.

The change in stock price reflected in OP isn't pocket change, in my opinion. I don't trade intel, but if it dropped from upper $60's to low $50's that usually causes the public sacrifice of a lamb.

Just my $.02USD. Not worth as much as it used to be.
 

d3athf1sh

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wow, what a bunch of soar losers. hey screw it, just keep suing till they run out of money and have to shut down! (would be a long time for intel, guess thats why they know they can get away with it)

is that something that you can normally do in the stock market, because if so i need to get involved.
 

d3athf1sh

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Yeah, but it's not like they produced millions of bad airbags. They allegedly materially misrepresented an outlook to investors with the intent of inflating stock price. So, they said they have a new, better airbag on the way in the near term - when in fact they were having manufacturing difficulties and were far behind schedule.

The change in stock price reflected in OP isn't pocket change, in my opinion. I don't trade intel, but if it dropped from upper $60's to low $50's that usually causes the public sacrifice of a lamb.

Just my $.02USD. Not worth as much as it used to be.
no bad airbags, it was the other kind of standard security that you get on a late model cpu.

heck they just found another vulnerability that affected all procs up to 11th gen in the past month! edit: 6th to 11th i think not all core procs.

edit: it's called PLATYPUS https://www.dsogaming.com/news/inte...nerability-company-releases-microcode-update/
 
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Nobu

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wow, what a bunch of soar losers. hey screw it, just keep suing till they run out of money and have to shut down! (would be a long time for intel, guess thats why they know they can get away with it)

is that something that you can normally do in the stock market, because if so i need to get involved.
No, because companies normally try not to outright lie to their investors. That kind of thing can get you in deep trouble with the SEC. And I'm not talking just fines and prison, I mean it can have serious consequences and reprecussions to the business itself (such as sanctions, losing control over certain aspects of the business, etc).

Sure, it happens occasionally, but it's usually not blatant or intentional.
 

d3athf1sh

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Yup. I expect that ARM is going to take over the massive server market - especially for those organizations that can literally afford to design their ARM chips. This level of specialization and customization isn't possible in x86. And ARM can do all of those server work loads, faster, cheaper, and more efficiently for a lower cost and higher density when specialized to do so.

I don't think ARM will take over the enterprise server market, but I do think it will become a major player and a viable alternative for many things.

man i hope not. usually server is a preview of tech that rolls down hill to desktop. & #fapple t oo

it'll be a cold day in hell before i stick an arm cpu in my desktop. i can tell you that.
 
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d3athf1sh

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No, because companies normally try not to outright lie to their investors. That kind of thing can get you in deep trouble with the SEC. And I'm not talking just fines and prison, I mean it can have serious consequences and reprecussions to the business itself (such as sanctions, losing control over certain aspects of the business, etc).

Sure, it happens occasionally, but it's usually not blatant or intentional.
but it's ok if they lie to the public, as long as investors are making money, just not to them. wow but how couldn't you say that about any investment? they told me this and that and still turn profit... but i want to get paid still?

whoopty frickin doo. all these people out here cant pay rent because of the lock down and these people can't go 3 months without making a dime on their stock? it's stock, not cash flow. so their stocks are guaranteed money makers and others like say Antec, Cooler Master, or say AMD's isn't?

how many quarters did amd stock holders go w/out profit?
 

Nobu

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but it's ok if they lie to the public, as long as investors are making money, just not to them. wow but how couldn't you say that about any investment? they told me this and that and still turn profit... whoopty frickin doo. all these people out here cant pay rent because of the lock down and these people can't go 3 months without making a dime? so there stocks are guaranteed money makers and say AMD's isn't?

how many quarters did amd stock holders go w/out profit?
The issue isn't that they lost money. They would have shrugged it off if it were just that. The issue is they lied about what was going on in the company, misleading them into thinking the company was doing well, and that they could expect positive results soon.

Imagine your doctor told you, "hey, looks like you have a minor cold, but you should get better in a few days." You had cold symptoms, so you believed him. He knew, though, that it was not just a cold, and that you could get much worse in a few days, but didn't tell you.

You would be upset if you later had to go to the ER because you had gotten very sick, right? Sure, it could have been something else you caught, but we know now that the doctor knew something else was up and didn't tell us.

This lack of communication not only prevents the company from correcting the problem properly, but it sets up investors for failure too, because nobody is in the loop. It's dishonest, and serves nobody good except maybe the executives.
 

d3athf1sh

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The issue isn't that they lost money. They would have shrugged it off if it were just that. The issue is they lied about what was going on in the company, misleading them into thinking the company was doing well, and that they could expect positive results soon.

Imagine your doctor told you, "hey, looks like you have a minor cold, but you should get better in a few days." You had cold symptoms, so you believed him. He knew, though, that it was not just a cold, and that you could get much worse in a few days, but didn't tell you.

You would be upset if you later had to go to the ER because you had gotten very sick, right? Sure, it could have been something else you caught, but we know now that the doctor knew something else was up and didn't tell us.

This lack of communication not only prevents the company from correcting the problem properly, but it sets up investors for failure too, because nobody is in the loop. It's dishonest, and serves nobody good except maybe the executives.

i see what you're saying. and i'm sure it's all legal or they wouldn't be doing it but just like every company that ever went out of business had a good sales pitch and that if this is how you can loose it all with one company and sue if you lose on the other. just from a layman seems unfair. just like i got into a couple arguments w/ well my parents for one about insider trading. isn't that how the whole thing works? if you hear of a good deal you jump on it. how did you hear about "said deal"? or is it only when a company's tanking you're not allowed to say anything? i mean so what IF someone leaked that (or intel themselves) said sales were tanking and it's not just because they got low yields. i mean is that legal? really they are probably just playing it safe and not wasting silicon? i mean could one bad quarter really ruin a company by giving stock holders control over a business they know nothing about and possibly destroy the company like that from the inside by greedy stock holders? actually may be their problem. idk, guess i prob sound un-informed because i am and, at the same time, guess i'm just kinda picking your brain to get an idea of how that mess works.
 

Nobu

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So, the investors have some say in what goes on in the company, more or less proportional to the amount of the company they own (their "share"). They make decisions about how much to invest in the company, how they vote on issues brought up in meetings, and other things, based on what they are told by board members, during investor calls, public announcements, etc. If they are given wrong, misleading, or incomplete information, then they cannot perform their responsibilities properly. This has a detrimental effect to the company as a whole, and is why any time it occurs it is treated seriously and dealt with quickly (often with someone losing their job).
 

Zarathustra[H]

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man i hope not. usually server is a preview of tech that rolls down hill to desktop. & #fapple t oo

it'll be a cold day in hell before i stick an arm cpu in my desktop. i can tell you that.

As long as there is a choice, I'm OK with it. Choice is usually a good thing, and can be the competition the PC market needs!
 
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