From Patch 1.19 Notes:

[dev1156] The reduction in gear effectiveness based on damage has been changed as follows:
The effectiveness of an item is not diminished when its Condition is between 1-100%. If Condition drops to 0%, however, the item will become damaged and offer no benefits whatsoever to the wearer. The effects of any materia attached will also be rendered invalid.
A yellow icon will appear as a warning for gear whose Condition has dropped below 10%.
A red icon will appear as a warning for gear currently equipped whose condition has dropped to 0%.

Currently, the text of yellow icon for gear whose Condition has dropped below 10% shows as follow:


So basically the text is giving wrong information.