Intel engineers discovered a flaw in the floating-point math subsection of the Pentium microprocessor. Under certain data dependent conditions, low order bits of the result of floating-point division operations would be incorrect, an error that can quickly compound in floating-point operations to much larger errors in subsequent calculations. Intel corrected the error in a future chip revision, but nonetheless declined to disclose it.

Dr. Thomas Nicely, Professor of Mathematics at Lynchburg College independently discovered the bug, and upon receiving no response from his inquiry to Intel, on October 30 posted a message on the Internet. Word of the bug spread quickly on the Internet and then to the industry press. Because the bug was easy to replicate by an average user (there was a sequence of numbers one could enter into the OS calculator to show the error), Intel's statements that it was minor and "not even an erratum" were not accepted by many computer users.
Ironically, the "Pentium flaw" incident, Intel's response to it, and the surrounding media coverage propelled Intel from being a technology supplier generally unknown to most computer users to a household name. Dovetailing with an uptick in the "Intel Inside" campaign, the episode is considered by some to have been a positive event for Intel, changing some of its business practices to be more end-user focused and generating substantial public awareness, while avoiding (for most users) a lasting negative impression. Intel did not handle the problem correctly at first. When Dr. Nicely informed Intel of the bug, they ignored the problem. Only after New York Times ran an article on the bug, did Intel change its position. To satisfy customers, Intel offered to replace every chip by putting in place a large and user support organization which resulted in a $475 million charge against Intel’s 1994 revenue.