14 DAY TRIAL // Hindsight is always 20/20, and some may say that the ones that just sued Advanced Micro Devices might want to take that into account. Then again, this could just as easily be a legitimate complaint.
And by complaint we mean that some investors in Advanced Micro Devices, who purchased stock between October 27, 2011 and October 18, 2012, have filed a class action against the company.
The suit was made through law firm Robbins Geller Rudman & Dowd and claims that Advanced Micro Devices misled everyone in regard to the true business prospects of its APUs.
In other words, it made it seem as though the Llano accelerated processing units, the so-called first generation, had much better chances for success than they really did.
To elaborate, AMD is being accused of having concealed adverse facts about the 32nm Llano APU, as well as having made false statements about it.
According to the plaintiffs, AMD lied about how strong the marketing position was, and how significant the interest was.
Because of that, stock sold at artificially inflated prices. Now, the investors want their money back.
It is true that Llano failed to live up to its hype, but this became clear only when AMD announced its financial results in July 2012, for the second quarter of that year.
China and Europe had a rather bland reception, despite having been labeled as the ones most likely to welcome the chips.
So the fire sale of AMD stock failed to return the investment, hence all the ruffled feathers. It didn't help when stock fell almost 25% on extremely heavy trading volume, or that gross margin slid down greatly for Q3 2013 (31% on quarter). An inventory write-down of $100 million / €74 million pulled stock another 17% downwards after that.
We're not sure how much money the investors want to be handed back. It will have to be calculated by the judge and hired economists.