Intel forecast crushes estimates as AI boom boosts chip demand; shares jump
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- Intel forecast Q3 revenue of $15.8B-$16.8B versus analyst estimates of $15.10B and adjusted profit of 38 cents per share versus 27 cents expected.
- Shares jumped 8% in post-market trading despite a 25% decline from a June 22 record close; the stock remains up more than 170% year-to-date.
- Q2 sales rose 25.4% to $16.13B with adjusted profit of 42 cents per share, beating estimates of $14.42B and 21 cents respectively; adjusted gross margin came in at 41.8% versus 38.8% expected.
- CFO David Zinsner told Reuters Intel is raising 2025 capital expenditure from $18B to $20B, with capex expected to be "up meaningfully next year" because agentic-AI CPU demand outstripped the company's manufacturing capacity.
- Intel has signed three-to-five-year agreements with data-centre CPU and XPU customers, some containing both volume and price commitments, Zinsner said; the company holds roughly $30B in cash and a $10B credit line, though Zinsner left a share sale on the table.
- Tesla signed on as a foundry customer for Intel's next-generation 14A process for its "Terafab" AI chip project, while an Apple deal announced by Trump in April remains unconfirmed by either company.
- Nvidia is making a rare move into CPUs with its "Vera" processor, while Amazon and Alphabet continue developing in-house Arm-based CPUs — raising the competitive stakes in the data-centre CPU market Intel is now betting on.
Why it matters: Intel raised 2025 capex by $2B after admitting agentic-AI demand for data-centre CPUs outstripped its manufacturing capacity, proof that CPU is staging a comeback in the AI buildout. CFO Zinsner's flag that a share sale remains possible shows even a blowout quarter hasn't solved how to fund the manufacturing expansion.
