Intel (INTC) & Potential Financial Impact Of CPU Flaws, Meltdown/Spectre

Now It’s far too early to see or feel any financial impacts from any of the lawsuits or the costs associated with fixing the current flaws and the ongoing patch efforts to reduces the Impact Of CPU Flaws, Meltdown/Spectre.

Intel (INTC) & Potential Financial Impact Of CPU Flaws, Meltdown/Spectre

Intel (INTC) & Potential Financial Impact Of CPU Flaws, Meltdown/Spectre

During Intel’s Q4 2016 earnings call, Tom’shardware reported that Intel has mentioned that it had created a then “undefined financial reserve” to deal with a large-scale warranty return for higher than expected processor failure rates. which they mentioned that it fund was due to the Atom C2000 failures. In this call, Intel did not make any mention of any new funds or reserves to deal with pending re-compensation programs for customers, although it did mention that last year’s fund cost them some profitability (“four points”).

Intel clearly sounds confident that it wont feel any near future issues or long-term pressure to its business for all that has happend. In response to a question that came from an analyst about the potential impacts of the new vulnerabilities and CPU flaws on Intel’s financial forecasts, Krzanich the Intels CEO responded:

“From a cost standpoint […] we don’t expect any material impact of this security exploit on our spending or product costs, or any of that, that’s how we bake that in.”

While Krzanich said that the company continually re-evaluates its financial forecasts and the forecasts have not changed. But then Intel also stated that it had updated its risk factors to reflect the threats and litigation:

We have and may continue to face product claims, litigation, and adverse publicity and customer relations from security vulnerabilities and/or mitigation techniques, including as a result of side-channel exploits such as “Spectre” and “Meltdown,” which could adversely impact our results of operations, customer relationships, and reputation. Separately, the publicity around recently disclosed security vulnerabilities may result in increased attempts by third parties to identify additional vulnerabilities, and future vulnerabilities and mitigation of those vulnerabilities may also adversely impact our results of operations, customer relationships, and reputation.

Tags: technology, intc, intel, intel cpu flaws, intel fixes, in-silicon CPU fixes, in-silicon, cpu, intel cpu, intel stocks, stocks, intel shares, intc stocks,

Mohsen Daemi
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