In a ruling just made public, US District Judge Trina Thompson threw out the fraud allegations, stating shareholders had mistakenly attributed a $7 billion operating loss to Intel’s Foundry Services unit.

Investors had claimed Intel deliberately delayed revealing these enormous losses, contributing to catastrophic job cuts, a dividend suspension, and one of the biggest single-day stock collapses in recent history.

Judge Thompson dismissed accusations against former CEO Patrick Gelsinger, concluding his optimistic claims about Intel experiencing "significant traction" and "growing demand for our foundry offering" related to specific customers, rather than overall declining revenue.

The judge ruled that shareholders were not misled, despite the company’s spiralling financial results.

The shareholders' lawsuit, which Intel had strongly contested, covered a critical period from January to August 2024, during which Intel announced an eye-watering $1.61 billion quarterly loss, plans to cut more than 15,000 jobs, and a halt to dividend payments in a desperate bid to save money.

Intel's share price crashed by 26 per cent the following day, erasing over $32 billion from its market value, as investors fled amid panic and anger.

Intel, headquartered in Santa Clara, California, has faced intense pressure amid fierce competition from rivals such as Nvidia, AMD, Samsung Electronics, and TTSMC, as it struggled to profit from the booming artificial intelligence market. The turmoil ultimately led to the ousting of CEO Patrick Gelsinger in December 2024.

Although the judge dismissed the current claims, she left open the possibility for shareholders to file an amended complaint. Neither Intel nor the shareholders’ lawyers provided any comment on the latest development.