Intel Beats Forecasts, Lifts Capex to $20B on AI Demand
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- Intel forecast Q3 revenue of $15.8B–$16.8B, above the $15.10B analyst estimate, with adjusted profit guidance of 38 cents per share versus 27 cents expected.
- Intel posted Q2 sales of $16.13 billion, up 25.4% year-over-year, with adjusted profit of 42 cents per share versus the 21-cent estimate and adjusted gross margin of 41.8% versus 38.8% expected.
- Intel raised its 2026 capital expenditure forecast from $18B to $20B and signaled spending will rise "meaningfully" in 2027, as agentic AI demand for data center CPUs outstripped the company's manufacturing capacity.
- Intel has signed three-to-five-year customer agreements for data center CPUs and XPUs — some bundling volume and price commitments — per CFO David Zinsner, who noted the chipmaker holds roughly $30 billion in cash and a $10 billion credit line.
- Intel's foundry unit secured Tesla as a customer for its 14A process on Elon Musk's "Terafab" AI chip project, while expectations rose after President Trump said Apple agreed to manufacture chips with Intel — though neither company has confirmed that deal.
- Intel shares closed down 2.3% Thursday but jumped 5% in after-hours trading; the stock remains down more than 25% from its June 22 record close yet up over 170% year-to-date.
- Nvidia is expanding into CPUs with its "Vera" processor, while Amazon and Alphabet continue building in-house Arm-based CPUs, intensifying competition in the data-center chip market Intel is betting on.
Why it matters: The raised capex and multi-year customer contracts mark Intel's clearest signal yet that the agentic AI boom is translating into sustained CPU revenue after years of trailing Nvidia. With $30B in cash and 3-to-5-year agreements locking in volume commitments, Intel is converting AI tailwinds into a comeback — but Nvidia's Vera CPU push and Amazon/Alphabet's in-house Arm chips raise the competitive stakes for the data-center market Intel is now leaning into.
