Key Highlights
- Intel delivered Q1 adjusted earnings per share of 29 cents, obliterating Wall Street’s 2-cent projection
- First-quarter revenue reached $13.6B, representing a 7% annual increase and exceeding the $12.4B projection
- Data center segment revenue surged 22% to $5.1B, fueled by increased CPU requirements for AI applications
- Second-quarter outlook projects revenue between $13.8B and $14.8B, significantly above analyst forecasts
- Shares have climbed more than 80% year-to-date in 2026, positioned to eclipse the August 2000 all-time closing record
Intel delivered a stunning first-quarter performance on Thursday that left analysts scrambling to revise their models. The chipmaker’s adjusted earnings per share of 29 cents demolished the consensus forecast of just 2 cents, while quarterly revenue of $13.6 billion significantly exceeded the $12.4 billion Wall Street anticipated.
Shares skyrocketed approximately 24% during Friday’s premarket session. Trading at $82.77, the stock stands poised to surpass its all-time closing record of $74.88 established in August 2000 — a benchmark that seemed unreachable merely a year ago.
Quarterly revenue increased 7.2% compared to the same period last year. This marks a notable shift considering Intel posted year-over-year revenue declines in five of the preceding seven quarters, making any positive growth a significant directional change.
The data center business unit emerged as the clear winner. Sales in this division jumped 22% to reach $5.1 billion, driven by accelerating demand for CPUs handling AI computational tasks. The traditional CPU market has experienced a renaissance as a critical component of AI infrastructure, especially as agentic computing requires more versatile processing capabilities.
“The CPU is reinserting itself as the indispensable foundation of the AI era,” CEO Lip-Bu Tan stated during the quarterly conference call. “This isn’t just our wishful thinking, it’s what we hear from our customers.”
Personal computer sales demonstrated resilience despite ongoing memory shortages pushing prices upward. Intel launched its Core Ultra Series 3 processor in January, while its Xeon 6+ data center chips debuted in March.
Second Quarter Outlook Exceeds Expectations
Intel provided second-quarter revenue guidance ranging from $13.8B to $14.8B with projected adjusted earnings per share of 20 cents. Wall Street analysts had estimated $13.07B in revenue and 9 cents EPS. The substantial difference between guidance and estimates is noteworthy.
Gross profit margins are projected to expand as well, addressing another area where Intel has faced challenges in recent periods.
Despite the impressive quarterly performance, Intel continues to operate at a loss. The company’s net loss expanded to $4.28 billion in the first quarter, partially attributed to a $4.1 billion restructuring charge related to goodwill impairment at its Mobileye division. The foundry division recorded a $2.4 billion loss.
Intel’s manufacturing operations remain the primary long-term question mark. While its 18A process technology is competitive from a technical standpoint, Intel currently represents the sole major client utilizing it. Yield challenges affecting certain 18A wafers have sparked concerns regarding production readiness for outside customers.
Elon Musk Collaboration Opens New Opportunities
The company’s trajectory took an interesting turn this month following Intel’s announcement of its involvement in Elon Musk’s Terafab semiconductor facility in Austin, Texas — manufacturing chips for SpaceX, xAI, and Tesla. During Tesla’s first-quarter earnings discussion, Musk revealed that Tesla intends to utilize Intel’s upcoming 14A process technology at this location.
“By the time Terafab scales up, 14A will probably be fairly mature or ready for prime time,” Musk indicated.
The 14A node isn’t scheduled for commercial production until 2028.
Intel also recently repurchased a 49% ownership stake in its Irish fabrication facility from Apollo Global Management for $14 billion — indicating that Tan is making a significant wager on the foundry segment’s future prospects.
CFO David Zinsner informed CNBC that advanced packaging capabilities — representing one of Intel’s authentic competitive advantages — has the potential to generate billions in revenue per major customer. The company’s current packaging clientele includes Amazon, Cisco, SpaceX, and Tesla.
