Intel reported second-quarter earnings of 42 cents per share, surpassing the expected 21 cents, with revenue reaching $16.1 billion compared to the anticipated $14.42 billion. This performance led to an 11% increase in stock price during extended trading.
The company's revenue growth of 25% is the highest since the third quarter of 2011, largely attributed to the surge in demand for server processors fueled by the artificial intelligence boom. CEO Lip-Bu Tan emphasized that AI is creating unprecedented demand for computing resources.
For the upcoming quarter, Intel forecasts adjusted earnings per share of 38 cents and revenue between $15.8 billion and $16.8 billion, exceeding analyst expectations of $15.1 billion in revenue and 27 cents in EPS. Intel is also establishing long-term agreements with customers for its server CPUs, which may help stabilize pricing and maintain market power amid fluctuating demand.
The data center segment saw a remarkable 59% revenue increase to $6.3 billion, while the client computing group, which produces PC chips, grew by 13% to $8.9 billion. Despite a recent 28% decline in stock value in July, Intel's overall stock has risen over 170% in 2026, bolstered by a 10% stake from the U.S. government aimed at supporting domestic chip manufacturing.
The company is also increasing capital expenditures to enhance its manufacturing capabilities and reported a gross margin recovery to 42%, up from 2.5% a year ago, due to higher revenue and improved pricing on chips