Intel's stock jumps as chipmaker rides AI boom to fastest revenue growth in almost 15 years
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- Intel reported Q2 revenue of $16.1 billion and adjusted EPS of 42 cents, beating LSEG consensus estimates of $14.42 billion and 21 cents, respectively, while guiding Q3 above analyst expectations.
- Intel's 25% revenue growth was its fastest quarterly rate since 2011, driven by a 59% surge in data center revenue to $6.3 billion as AI infrastructure demand accelerated server chip sales.
- Intel shares rose roughly 4% in extended trading, recovering from a 28% July slump; the stock remains up more than 170% year-to-date in 2026 after a prior-year 84% gain tied to the U.S. government's 10% stake.
- CFO David Zinsner said Intel is supply constrained in data center, with customers demanding more chips than Intel can produce, and the company has signed 10 long-term customer agreements including locked-in pricing and volume commitments.
- Intel's client computing group revenue rose 13% to $8.9 billion, but the company expects flat PC sales in Q3 due to a memory shortage; gross margin recovered to 42% from 2.5% a year earlier.
- Intel's foundry business reported $5.8 billion in sales, up 31% year-over-year, with the 14A manufacturing process ahead of schedule; CEO Lip-Bu Tan secured Fortinet as a named foundry customer earlier this week using older technology.
- Intel plans a meaningful increase in capital expenditures next year, primarily for factory tooling, as it pushes to become a chip manufacturer for other companies.
Why it matters: Intel's 25% revenue growth marks its strongest quarter since 2011 and reverses a long slide, but the company is now supply-constrained on data center chips with customers wanting more than it can produce, giving Intel pricing leverage via 10 long-term agreements that lock in volume and pricing before AI demand cools.
