Intel's Potentially Major Security Flaw Boosting AMD, Other Chip Stocks

Intel Corporation INTC fell 3 percent pre-market Wednesday on a Register report that its x86-64 processors, devices produced throughout the last decade, have a major security flaw compromising information stored in the kernel memory.

The problem bares the contents of Intel processors, including passwords, to basic user programs like browser JavaScript and database applications and potentially provides an entrypoint for malware and hackers.

The solution, a software overwrite of affiliated operating systems including Windows, Linux and macOS to isolate the kernal memory from user processes, could slow OS performance between 5 and 30 percent, according to The Register. Microsoft Corporation MSFT and other affected device makers are said to be developing patches for release next week.

The flaw is significant to Intel, which has profited off the semiconductor industry's recent explosion and stands to lose a sizable part of the market. This November saw the global space grow 21.5 percent year over year to $37.7 billion, according to the Semiconductor Industry Association.

Intel's failure has been well-received by market peers, though:

• Advanced Micro Devices, Inc. AMD spiked 6.9 percent in pre-market trading;
• NVIDIA Corporation NVDA 2.1 percent;
• Micron Technology, Inc. MU 1.8 percent;
• Taiwan Semiconductor Mfg. Co. Ltd. (ADR) TSM 0.4 percent;
• STMicroelectronics NV (ADR) STM 1 percent; and
• Market Vectors Semiconductor ETF SMH 2.7 percent.

Intel defended its products and suggested that the alleged flaws may not yield the vulnerabilities described.

“Intel believes these exploits do not have the potential to corrupt, modify or delete data,” the company said in a statement Wednesday afternooon. “Recent reports that these exploits are caused by a ‘bug’ or a ‘flaw’ and are unique to Intel products are incorrect. Based on the analysis to date, many types of computing devices — with many different vendors’ processors and operating systems — are susceptible to these exploits.”

The firm said it is collaborating with other technology companies on industry-wide solutions, and any performance slowdowns “should not be significant” to the average user.

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