Intel shares jumped nearly 11% in initial after-hours trading Thursday after the chipmaker posted second-quarter revenue and adjusted earnings well above Wall Street estimates. The stock later pared the gain as executives discussed higher spending and supply constraints during the earnings call.
Intel reported $16.1 billion in second-quarter revenue, up 25% from $12.9 billion a year earlier and above the $14.42 billion expected by analysts. Adjusted earnings reached $0.42 per share, double the $0.21 consensus estimate and up from a $0.10 loss in the same quarter last year.
Adjusted gross margin rose to 41.8%, compared with 29.7% a year earlier and the 38.8% expected by analysts. Intel generated $7 billion in operating cash flow during the quarter.
AI Demand Lifts Data Center Sales
Data Center and AI revenue climbed 59% to $6.3 billion as demand for server processors exceeded Intel’s available supply. The division topped Wall Street’s $5.37 billion forecast as cloud providers and companies building AI-agent infrastructure increased CPU orders.
Client Computing and Physical AI revenue rose 13% to $8.9 billion, while Intel Foundry generated $5.8 billion, up 31%. The foundry division remained central to Intel’s turnaround after reports linking Google and Nvidia to potential manufacturing demand sent the shares sharply higher in June.
The second-quarter gain extends a rally that accelerated when Intel reached a record high following its first-quarter earnings. INTC remains more than 170% higher in 2026 despite retreating from its June peak during a wider semiconductor selloff.
Intel Raises Spending And Q3 Guidance
Intel expects third-quarter revenue between $15.8 billion and $16.8 billion, above the $15.1 billion analyst forecast. Adjusted earnings are projected at $0.38 per share, compared with the $0.27 expected by Wall Street.
The company raised its 2026 capital expenditure plan to $20 billion from $18 billion and expects spending to increase again next year. Intel has signed three-to-five-year agreements covering data center CPUs and specialized processors, with some contracts including volume and pricing commitments.
Intel recorded an $11 billion GAAP net loss after a roughly $12.5 billion mark-to-market charge tied to shares held in escrow under its agreement with the U.S. government. Core operations produced $1.8 billion in operating income and $2.2 billion in adjusted net income.
CEO Lip-Bu Tan said stronger customer engagement had made Intel fully committed to high-volume production of its next-generation 14A manufacturing process in 2028.
