Adeia (NASDAQ: ADEA), a U.S. tech licensing firm, saw its stock plummet 5.52% in Tuesday's trading session, continuing its downward trend from Monday's 16% drop. The decline comes in the wake of the company's disappointing financial outlook and recent legal actions against chip giant Advanced Micro Devices (AMD).

On Monday, Adeia lowered its full-year revenue and net income expectations, citing an unlikely finalization of a license agreement with AMD in the fourth quarter as previously anticipated. This announcement triggered a significant sell-off, with investors reacting negatively to the revised financial projections.

Adding to the company's challenges, Adeia filed two lawsuits against AMD in Texas federal court on Monday, alleging infringement of ten patents related to semiconductor innovations. The legal action targets several AMD processor models, including those featuring "3D V-Cache" technology used in AI chips. Adeia claims that AMD's unauthorized use of its patented methods has "greatly contributed to their success as a market leader."

Despite the recent downturn, Adeia's stock has shown resilience over the past year, with a 14% increase. However, the combination of lowered financial expectations and the uncertain outcome of the legal battle with AMD has created short-term pressure on the company's stock price. Investors will be closely watching for any developments in the lawsuit and Adeia's ability to secure new licensing agreements in the coming quarters.