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Investing.com -- A federal judge has dismissed a lawsuit that accused Intel Corp (NASDAQ:INTC) of defrauding shareholders by hiding problems in its foundry business, which led to a $32 billion single-day market value decline.
U.S. District Judge Trina Thompson in San Francisco ruled on Wednesday that Intel did not delay too long in revealing a $7 billion operating loss for fiscal 2023 in its foundry business, which manufactures chips for external customers.
The judge dismissed the case with prejudice, meaning shareholders cannot file the lawsuit again.
Intel’s stock price dropped 26% on August 2 last year, following the company’s announcement of more than 15,000 job cuts and dividend suspension. These measures were aimed at saving $10 billion in 2025.
In her 21-page decision, Judge Thompson noted that Intel had clearly indicated that foundry results would be "obscured" until 2024, which meant its earlier financial reporting was not false or misleading.
The Santa Clara, California-based chipmaker established its foundry business in 2021 to serve customers including Amazon.com (NASDAQ:AMZN) and Qualcomm (NASDAQ:QCOM), while continuing to produce chips and wafers for its own use.
Thompson also cited an "overarching policy consideration" that Intel’s public statements suggested a "trial-and-error" approach to the foundry business, and the company might have faced risks from reporting preliminary, unaudited data.
This was the second dismissal of the lawsuit, with an earlier version having been rejected in March.
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