Intel Shareholder Lawsuit Dismissed, Company Faces Ongoing Challenges

1 min read     Updated on 25 Jul 2025, 11:30 AM
scanxBy ScanX News Team
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Overview

A federal judge has dismissed a shareholder lawsuit against Intel Corporation that accused the company of defrauding investors. The lawsuit, which followed a 26% stock price drop and $32 billion market value loss, claimed Intel delayed disclosing losses in its foundry business. Judge Trina Thompson ruled that Intel did not wait too long to disclose these losses, noting the company had previously indicated that foundry results would not be clearly visible until 2024. The dismissal was made with prejudice, preventing refiling of the same lawsuit.

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*this image is generated using AI for illustrative purposes only.

In a significant legal development for Intel Corporation , a federal judge has dismissed a shareholder lawsuit that accused the tech giant of defrauding investors. The lawsuit, which stemmed from a dramatic 26% plunge in Intel's stock price on August 2, resulting in a $32.00 billion loss in market value, has been thrown out by U.S. District Judge Trina Thompson.

Lawsuit Dismissal

Judge Thompson ruled that Intel did not wait too long to disclose losses in its foundry business, a key point of contention in the lawsuit. The judge noted that Intel had previously indicated that the foundry results would not be clearly visible until 2024. This dismissal, made with prejudice, prevents shareholders from refiling the same lawsuit in the future.

Intel's Recent Challenges

The dismissed lawsuit highlighted several challenges facing the semiconductor giant:

  • Over 15,000 layoffs announced
  • Suspension of dividend payments
  • A $7.00 billion operating loss in the foundry division for fiscal 2023

These developments underscore the difficulties Intel has encountered in its efforts to compete in the rapidly evolving semiconductor industry, particularly in the artificial intelligence (AI) market.

Foundry Business Struggles

Intel created its foundry business in 2021 with the aim of manufacturing chips for external customers, including major tech players like Amazon.com and Qualcomm. However, the division has faced significant hurdles, contributing to the company's financial woes.

Historic Annual Loss

In a stark illustration of Intel's current struggles, the company reported an $18.80 billion loss, marking its first annual loss since 1986. This financial setback reflects Intel's ongoing challenges in maintaining its competitive edge against rivals such as Nvidia, AMD, Samsung, and TSMC, especially in the burgeoning AI chip market.

Looking Ahead

While the dismissal of the shareholder lawsuit removes one legal obstacle for Intel, the company still faces significant challenges in revitalizing its business and regaining its footing in the highly competitive semiconductor industry. As the tech landscape continues to evolve, particularly with the rise of AI, Intel's ability to innovate and adapt will be crucial for its future success.

The dismissal of this lawsuit may provide some relief to Intel's management, allowing them to focus more intently on addressing the company's operational and competitive challenges without the distraction of this legal proceeding.

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Intel Slashes Over 5,000 US Jobs in Major Cost-Cutting Drive

1 min read     Updated on 19 Jul 2025, 12:14 PM
scanxBy ScanX News Team
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Overview

Intel is implementing a significant workforce reduction, laying off more than 5,000 employees across four US states starting July. California will see 1,935 job cuts, Oregon 2,392, Arizona 696, with additional cuts expected in Texas. The restructuring extends globally, with operations affected in Germany and Israel. This move is part of CEO Lip-Bu Tan's turnaround strategy following Intel's $19 billion annual loss. The company aims to reduce operating expenses by $500 million this year, with an additional $1 billion in cost cuts targeted.

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*this image is generated using AI for illustrative purposes only.

Intel , the semiconductor giant, is implementing a significant workforce reduction across four US states as part of a broader cost-cutting initiative. The company plans to lay off more than 5,000 employees, with the cuts set to begin in July, primarily affecting operations in California and Oregon.

Layoff Details

The layoffs will impact Intel's workforce across several locations:

  • California: 1,935 employees in Santa Clara and Folsom
  • Oregon: 2,392 staff in Hillsboro
  • Arizona: 696 employees in Chandler
  • Texas: Additional cuts expected, though specific numbers were not disclosed

Global Impact

The restructuring extends beyond US borders:

  • Germany: Shutting down the automotive chip division in Munich
  • Israel: Reducing headcount, though specific numbers were not provided

Strategic Rationale

These layoffs are a crucial component of CEO Lip-Bu Tan's turnaround strategy, following Intel's challenging financial performance:

  • Intel reported a $19.00 billion annual loss, its first loss in nearly four decades
  • The company aims to slash operating expenses by $500.00 million in the current year
  • Further cost reductions of $1.00 billion are targeted

Organizational Transformation

Intel's official statement emphasizes the company's goal to become "leaner, faster and more efficient by removing organizational complexity." This restructuring appears to be a direct response to the company's recent financial struggles and changing market dynamics in the semiconductor industry.

Industry Context

The semiconductor industry has been facing various challenges, including supply chain disruptions, intense competition, and shifting market demands. Intel's aggressive cost-cutting measures reflect the company's efforts to adapt to these challenges and position itself for future growth.

As the layoffs begin to take effect in July, the tech industry will be watching closely to see how these changes impact Intel's operations and competitive position in the global semiconductor market.

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