Case Summary

Intel

NASDAQ: INTC

Case Details

  • Quille v. Intel Corporation et al.
  • Class Period:January 25, 2024 - April 25, 2024
  • Date Filed:May 03, 2024
  • Jurisdiction:U.S. District Court, Northern District of California
  • Docket Number: 3:24-cv-02683
  • Lead Plaintiff Deadline: July 3, 2024
Days Left to
Seek Plaintiff
39

Overview

A class action lawsuit has been filed against Intel Corporation (“Intel” or the “Company”) (NASDAQ: INTC) and certain of the Company’s current and former senior executive officers alleging violations of the federal securities laws.  The Intel class action lawsuit is brought on behalf of all persons and entities who purchased or otherwise acquired Intel securities between January 25, 2024, and April 25, 2024, both dates inclusive (the “Class Period”).  Investors have until July 3, 2024, to seek appointment as lead plaintiff of the Intel class action lawsuit.

Intel designs, develops, manufactures, markets, and sells computing and related products and services worldwide.  The Company’s product portfolio is comprised of central processing units (CPUs), chipsets, processors, graphics processing units (GPUs), and other semiconductor products.  It also offers silicon devices and software products; and optimization solutions for workloads, such as artificial intelligence (“AI”), cryptography, security, storage, and networking.

The Intel lawsuit alleges that on March 23, 2021, Chief Executive Officer Pat Gelsinger laid out his vision for the future of the Company under a program he dubbed “IDM 2.0.”  To deliver on this vision, the Company announced it would reconfigure and would now be operating through the following reportable segments: Client Computing Group, Data Center and AI, Network and Edge, Mobileye, and Intel Foundry Services (“IFS”).  IFS was created to encompass the Company’s packaging and process technology.  Beginning in the first quarter of fiscal year 2022, the Company utilized these segments to report revenue.  Then, on October 11, 2022, Gelsinger announced the Company would shift to an “internal foundry model” (also known as the “Internal Foundry” or “Foundry” model).  Under the Internal Foundry model, Intel would recognize revenues generated from both external foundry customers and Intel Products, as well as technology development and product manufacturing costs historically allocated to Intel Products.

On June 21, 2023, the Company provided an update on the Foundry model, explaining that, beginning in the first quarter of 2024, the Company would separate all manufacturing services into a separate group, inclusive of IFS, manufacturing, and technology development, to form the Foundry, and implement a new financial reporting structure to recognize this reorganization, under which Foundry would be responsible for its own reportable profit and losses (P&Ls).  The Company emphasized the cost saving and margin improving benefits the Internal Foundry model would provide and the tailwind it would bring to IFS.

The Intel class action lawsuit alleges that Defendants, throughout the Class Period, failed to disclose to investors that: (1) the growth of Intel Foundry Services was not indicative of revenue growth reportable under the Internal Foundry segment; (2) the Foundry experienced significant operating losses in 2023; (3) the Foundry experienced a decline in product profit driven by lower internal revenue; (4) as a result, the Foundry model would not be a strong tailwind to the Company’s IFS strategy; and (5) as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

As alleged in the Intel class action lawsuit, on April 2, 2024, after the markets closed, Intel issued a press release which disclosed a retrospective revision of the Company’s financial results under the new Foundry model reporting structure, revealing that the Foundry segment experienced an operating loss of $7 billion on sales of $18.9 billion in 2023; that Foundry revenue in 2023 was $18.9 billion, down $8.6 billion from 2022; and that the segment’s operating loss included a $2.1 million decline in product profit, which was driven by lower internal revenue.  On this news, Intel’s stock price fell $3.61, or 8.2%, to close at $40.33 per share on April 3, 2024, on unusually heavy trading.

On April 25, 2024, after the markets closed, Intel released its first quarter 2024 financial results, the first quarter reporting the Company’s results under the Foundry model; the results revealed the Company’s Foundry segment declined 10% compared to the same quarter last year, to a revenue of $4.4 billion.  On this news, Intel’s stock price fell $3.23, or 9.2%, to close at $31.88 per share on April 26, 2024, on unusually heavy trading.

*          *          *

If you purchased or otherwise acquired Intel securities between January 25, 2024, and April 25, 2024, both dates inclusive, and you wish to serve as lead plaintiff in this lawsuit, we encourage you to submit your information to DiCello Levitt LLP via the form on this page. 

You can also contact DiCello Levitt partner Brian O’Mara by calling (888) 287-9005 or at investors@dicellolevitt.com. 

The deadline to apply to the Court to serve as a lead plaintiff in the Intel lawsuit is July 3, 2024.

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