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Given the news did not seriously affect the price of the stock (3-4% is a little more than typical volatility, but not much), it seems like his defense would be

Given the news did not seriously affect the price of the stock (3-4% is a little more than typical volatility, but not much), it seems like his defense would be very simple. "I did not consider this to be material non-public information, and indeed, it has turned out as I expected." In fact, he'd have been better off to wait until after the disclosure to sell based on the current price (45.3) and the price when he sold (44.8).

sulam 9y ago
That’s a very premature read. The market is still digesting this news.
- discoursism 9y ago
  I think for something this big, the foreseeable effects would be priced in by now. But, I'm no finance expert. I could be wrong.
  - lostmsu 9y ago
    NVidia was growing for a year after Polaris release with nearly 50% performance jump. It still is growing.
  - 086421357909764 9y ago
    I don't the the impacts have really begun to be felt yet. We're already anticipating over 20% based upon our current AWS findings (as others have pointed out their dilemmas as well). If i'm a larger company looking at a sudden increase of 20-30% for operations, i'm going to have a pretty strong response. I would imagine it takes upwards of 1 quarter before the Tech impact becomes a Business cost impact.
    - Someone 9y ago
      Your code may be, but I would think most code isn’t CPU bound nowadays. If so, that may lessen the impact on Intel quite a bit. Or does this indirectly affect network and disk speed, too?
    - omgtehlion 9y ago
      based on AWS findings we should expect the stock to be up, not down: after software mitigation everyone will need more horsepower to run the same load, and guess where they would buy new chips? (given that updating infrastructure to use AMD, let alone ARM, would cost more time and money than just suck it up).
      - heisenbit 9y ago
        Well, they may chose to spend more money on specialized chips they earlier have thought of as risky. But the whole risk considerations are now out of the window. You never got fired for buying from IBM and then Intel. Now Intel lost the magic touch and is just one among others. That will affect their pricing power big time - check out their pricing history over the past years and you notice some strong tendency for functional pricing which is an indication of near monopoly pricing power. Expect profits to dive.
        mcny 9y ago
        > Well, they may chose to spend more money on specialized chips they earlier have thought of as risky. But the whole risk considerations are now out of the window. You never got fired for buying from IBM and then Intel. Now Intel lost the magic touch and is just one among others. That will affect their pricing power big time - check out their pricing history over the past years and you notice some strong tendency for functional pricing which is an indication of near monopoly pricing power. Expect profits to dive. I expect a firesale in current and possibly next gen Intel processors. They have a healthy margin that should not exist. I want at least a 20% possibly 30% price cut across the board for all Intel processors. Oh and I expect the CEO to go to prison for a long, long time. Anything that does not involve at least five years in prison sends a wrong message to board rooms everywhere.
        rhaps0dy 9y ago
        You expect, or you want? These words often mean different things.
  - darkerside 9y ago
    There are many foreseeable effects. Some of them will actually happen and others won't. Some of them are in direct contradiction with others. Some of them will result in a greater or lesser financial impact than expected. Beyond that there are unforeseen and unforeseeable impacts. Discounting all that, yes, I believe the market is reasonably efficient.
- invaliduser 9y ago
  I agree, this is very premature, we don't have all the information yet. I purchased an i9 in december, because I cared about the performance, not the price, and had I known the little information we have now, I would have switched to AMD (I even hesitated to do so at the time). I am still able to send back my i9 to amazon, until end of january, and as I am in europe, I also have a 2-year guarantee against faulty or non-conform goods. Not sure if it can apply, but as of today nobody can tell what kind of action we can take against this (I understand the intel claims this is not a bug, but others may beg to differ). Also, besides any legalities, I am now an angry customer and would probably not buy intel anymore after this.
- mywittyname 9y ago
  My take is that Intel issues in the past have not affected profitability, so it's unlikely that this one will. When investors see that there are operating system fixes for it, and that those fixes apply to AMD and ARM processors, it doesn't seem like a big deal. It doesn't look like there's going to be a massive recall of it, and there are no issues going forward. So, while it's technically a BFD, as of now, investors are not seeing how this negatively impacts Intel's ability to make money. Plus, Intel's PR team did a good job at damage control. If anything, it makes newer chips even more compelling.
gozur88 9y ago
I don't understand why it didn't affect the stock price more. This is a big deal.
- vxNsr 9y ago
  Because most people don't know what any of this means. To nearly everyone else it sounds like Intel was hacked. But so what? Nearly every company has been hacked in the last three years, so it just doesn't seem like such a big deal. Obviously this is completely wrong but it's how the general public and walstreet will interpret it.
- dx034 9y ago
  Because it won't change Intel's future value if buying decisions don't change. I don't expect people to shift away from Intel because of this so wouldn't expect revenues or income to drop. Unless they get hit with lawsuits (unlikely for a bug), this shouldn't affect their business too much.
  - gozur88 9y ago
    It's difficult for me to imagine they won't get sued over this, and in a big way. Imagine if you're Amazon or Microsoft looking at a 30% reduction in salable CPU resources. Plus a huge class action suit from consumers based on false advertising or some related claim.
    - dx034 9y ago
      Bugs happen. Their verification process was probably subpar but I'd be surprise if lawsuits were successful in this case. I'm not sure if they buy processors from Intel with a performance promise (benchmark values). If not, no promise has been broken with this.
- phyller 9y ago
  I expect this is more of a positive for AMD than a negative for Intel. Perversely, this incentivizes people to get newer chips more quickly. If trust in Intel is not lost completely, and Intel puts out new chips that do not have this vulnerability, Intel could actually get more sales out of it. If the new chips were going to have a 30% performance boost, now it looks like they will have a 50% performance boost. Much more compelling.

sulam 9y ago

That’s a very premature read. The market is still digesting this news.

discoursism 9y ago
I think for something this big, the foreseeable effects would be priced in by now. But, I'm no finance expert. I could be wrong.
- lostmsu 9y ago
  NVidia was growing for a year after Polaris release with nearly 50% performance jump. It still is growing.
- 086421357909764 9y ago
  I don't the the impacts have really begun to be felt yet. We're already anticipating over 20% based upon our current AWS findings (as others have pointed out their dilemmas as well). If i'm a larger company looking at a sudden increase of 20-30% for operations, i'm going to have a pretty strong response. I would imagine it takes upwards of 1 quarter before the Tech impact becomes a Business cost impact.
  - Someone 9y ago
    Your code may be, but I would think most code isn’t CPU bound nowadays. If so, that may lessen the impact on Intel quite a bit. Or does this indirectly affect network and disk speed, too?
  - omgtehlion 9y ago
    based on AWS findings we should expect the stock to be up, not down: after software mitigation everyone will need more horsepower to run the same load, and guess where they would buy new chips? (given that updating infrastructure to use AMD, let alone ARM, would cost more time and money than just suck it up).
    - heisenbit 9y ago
      Well, they may chose to spend more money on specialized chips they earlier have thought of as risky. But the whole risk considerations are now out of the window. You never got fired for buying from IBM and then Intel. Now Intel lost the magic touch and is just one among others. That will affect their pricing power big time - check out their pricing history over the past years and you notice some strong tendency for functional pricing which is an indication of near monopoly pricing power. Expect profits to dive.
      - mcny 9y ago
        > Well, they may chose to spend more money on specialized chips they earlier have thought of as risky. But the whole risk considerations are now out of the window. You never got fired for buying from IBM and then Intel. Now Intel lost the magic touch and is just one among others. That will affect their pricing power big time - check out their pricing history over the past years and you notice some strong tendency for functional pricing which is an indication of near monopoly pricing power. Expect profits to dive. I expect a firesale in current and possibly next gen Intel processors. They have a healthy margin that should not exist. I want at least a 20% possibly 30% price cut across the board for all Intel processors. Oh and I expect the CEO to go to prison for a long, long time. Anything that does not involve at least five years in prison sends a wrong message to board rooms everywhere.
        rhaps0dy 9y ago
        You expect, or you want? These words often mean different things.
- darkerside 9y ago
  There are many foreseeable effects. Some of them will actually happen and others won't. Some of them are in direct contradiction with others. Some of them will result in a greater or lesser financial impact than expected. Beyond that there are unforeseen and unforeseeable impacts. Discounting all that, yes, I believe the market is reasonably efficient.
invaliduser 9y ago
I agree, this is very premature, we don't have all the information yet. I purchased an i9 in december, because I cared about the performance, not the price, and had I known the little information we have now, I would have switched to AMD (I even hesitated to do so at the time). I am still able to send back my i9 to amazon, until end of january, and as I am in europe, I also have a 2-year guarantee against faulty or non-conform goods. Not sure if it can apply, but as of today nobody can tell what kind of action we can take against this (I understand the intel claims this is not a bug, but others may beg to differ). Also, besides any legalities, I am now an angry customer and would probably not buy intel anymore after this.
mywittyname 9y ago
My take is that Intel issues in the past have not affected profitability, so it's unlikely that this one will. When investors see that there are operating system fixes for it, and that those fixes apply to AMD and ARM processors, it doesn't seem like a big deal. It doesn't look like there's going to be a massive recall of it, and there are no issues going forward. So, while it's technically a BFD, as of now, investors are not seeing how this negatively impacts Intel's ability to make money. Plus, Intel's PR team did a good job at damage control. If anything, it makes newer chips even more compelling.

gozur88 9y ago

I don't understand why it didn't affect the stock price more. This is a big deal.

vxNsr 9y ago
Because most people don't know what any of this means. To nearly everyone else it sounds like Intel was hacked. But so what? Nearly every company has been hacked in the last three years, so it just doesn't seem like such a big deal. Obviously this is completely wrong but it's how the general public and walstreet will interpret it.
dx034 9y ago
Because it won't change Intel's future value if buying decisions don't change. I don't expect people to shift away from Intel because of this so wouldn't expect revenues or income to drop. Unless they get hit with lawsuits (unlikely for a bug), this shouldn't affect their business too much.
- gozur88 9y ago
  It's difficult for me to imagine they won't get sued over this, and in a big way. Imagine if you're Amazon or Microsoft looking at a 30% reduction in salable CPU resources. Plus a huge class action suit from consumers based on false advertising or some related claim.
  - dx034 9y ago
    Bugs happen. Their verification process was probably subpar but I'd be surprise if lawsuits were successful in this case. I'm not sure if they buy processors from Intel with a performance promise (benchmark values). If not, no promise has been broken with this.
phyller 9y ago
I expect this is more of a positive for AMD than a negative for Intel. Perversely, this incentivizes people to get newer chips more quickly. If trust in Intel is not lost completely, and Intel puts out new chips that do not have this vulnerability, Intel could actually get more sales out of it. If the new chips were going to have a 30% performance boost, now it looks like they will have a 50% performance boost. Much more compelling.