Intel (INTC) has won its battle against a $1.2 billion antitrust fine in Europe. Reuters reports that Europe’s second-highest court has sided with the chipmaker, reiterating that alleged antitrust allegations that resulted in the fine did not meet the requisite legal standard. INTC shares rose 1.35% to close at $51.69 on January 26.
Intel is a U.S. company that designs, manufactures, and sells chipsets, flash memory, and other products. It also operates a data-centric business focused on data centers and the Internet of things. Intel’s upcoming earnings report for Fiscal Q1 2022 is scheduled for April 28, 2022.
In 2009, the European Commission hit Intel with the $1.2 billion fine for allegedly blocking rival Advanced Micro Devices by giving rebates to its customers, including Hewlett Packard, NEC, and Lenovo, which at the time, were its biggest customers.
The Luxembourg-based court has since concluded that the E.U. Commission’s analysis of the matter was incomplete. The court argues that it was impossible to establish the kind of impact the rebates had and whether they were anti-competitive. While regulators don’t like rebates issued by dominant players, they are required to prove that they have anti-competitive effects.
The Commission has since reiterated that it will study the judgment and plot its next steps. The annulment of the $1.2 billion fine is not only a big win for Intel, but for other tech giants facing similar fines in the region. Alphabet’s (GOOGL) Google is already embroiled in a fight against a hefty E.U. Commission fine. Amazon (AMZN), Meta Platforms’ (FB) Facebook, and Apple (AAPL) are also facing antitrust charges.
Barclays analyst Blayne Curtis recently reiterated a Sell rating on Intel stock and increased the price target to $50 from $45, implying 3.27% downside potential to current levels.
Consensus among analysts is a Hold based on 4 Buys, 5 Holds, and 4 Sells. The average Intel price target of $57 implies 10.27% upside potential to current levels.
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