Intel is facing a derivative lawsuit filed by shareholders targeting former CEO Pat Gelsinger, interim co-CEO/CFO David Zinsner, and board members for alleged securities law violations and fiduciary breaches related to its struggling foundry business. Shareholders accuse Intel executives of misrepresenting the financial health of Intel Foundry Services (IFS), which reported a $7 billion operating loss in 2023 and continued heavy losses in 2024. This latest lawsuit seeks restitution for Intel amid mounting challenges, including declining revenues, layoffs, a suspended dividend, and Gelsinger’s December 2024 resignation. In 2024 alone, Intel faced multiple lawsuits—derivative claims in June and December, a shareholder class action in August, and a chip voltage-related suit in November—alleging mismanagement, fiduciary breaches, and inadequate risk disclosures. The most recent lawsuit was filed in federal court in San Jose, California, on December 16, 2024.
My Take
These lawsuits underscore the need for transparent risk disclosure and strategic clarity as Intel seeks to rebuild investor trust and stabilize its operations.
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Link to article:
https://www.theregister.com/2024/12/18/intel_sued_foundry_business/
Credit: The Register
This post was enhanced with AI assistance, thoroughly reviewed, edited, and reflects my own thoughts.