Key Takeaways
- Intel delivered adjusted Q1 earnings of 29 cents per share, obliterating Wall Street’s 2-cent projection
- First-quarter revenue reached $13.6B, climbing 7% annually and exceeding the $12.4B consensus
- Data center business surged 22% to $5.1B, fueled by accelerating CPU requirements for AI infrastructure
- Second-quarter outlook projects revenue between $13.8B and $14.8B, significantly above analyst models
- Shares have climbed more than 80% year-to-date in 2026, approaching the all-time record close from August 2000
Intel delivered first-quarter financial results on Thursday that defied analyst predictions across the board. The chipmaker reported adjusted earnings per share of 29 cents, dramatically surpassing the consensus target of just 2 cents, while quarterly revenue of $13.6 billion comfortably exceeded projections of $12.4 billion.
Shares soared approximately 24% during Friday’s pre-market session. Trading at $82.77, the stock is positioned to eclipse its historical closing peak of $74.88 established in August 2000 — a threshold that would have appeared inconceivable merely a year ago.
Quarterly revenue advanced 7.2% compared to the same period last year. This marks a notable shift after the company experienced year-over-year contractions in five of the preceding seven quarters, making any positive growth a significant turning point.
The data center segment emerged as the performance leader. Revenue in this division surged 22% to reach $5.1 billion, driven by intensifying demand for central processing units supporting AI computational tasks. The traditional CPU market has regained strategic importance within the AI infrastructure landscape, especially as agentic computing architectures require enhanced general-purpose processing capabilities.
“The CPU is reinserting itself as the indispensable foundation of the AI era,” CEO Lip-Bu Tan said on the earnings call. “This isn’t just our wishful thinking, it’s what we hear from our customers.”
Personal computer sales demonstrated resilience beyond expectations despite memory component shortages creating upward price pressure. Intel’s Core Ultra Series 3 processor debuted in January, while its Xeon 6+ data center processors launched in March.
Second-Quarter Outlook Exceeds Projections
Management issued second-quarter revenue guidance ranging from $13.8B to $14.8B alongside adjusted earnings per share of 20 cents. The Street had anticipated $13.07B in revenue with 9 cents in EPS. This substantial differential warrants attention.
Gross profit margins are projected to expand as well, addressing another metric where Intel has faced headwinds in recent periods.
Despite the earnings triumph, Intel continues to operate at a net loss. The company reported a net loss of $4.28 billion during Q1, partially attributed to a $4.1 billion restructuring expense related to goodwill impairment at its Mobileye division. The foundry operation recorded a $2.4 billion loss.
Intel’s manufacturing operations represent the enduring strategic challenge. While its 18A process technology demonstrates competitive capabilities, Intel remains essentially the sole major client utilizing it. Production yield complications on certain 18A wafers have generated concerns regarding preparedness for third-party manufacturing contracts.
Musk Collaboration Introduces Fresh Momentum
The company’s strategic narrative evolved significantly this month when Intel revealed its participation in Elon Musk’s Terafab semiconductor manufacturing complex in Austin, Texas — producing chips for SpaceX, xAI, and Tesla. During Tesla’s first-quarter earnings discussion, Musk verified that Tesla intends to leverage Intel’s forthcoming 14A process technology at the Texas facility.
“By the time Terafab scales up, 14A will probably be fairly mature or ready for prime time,” Musk said.
The 14A node isn’t anticipated to reach production until 2028.
Intel also recently reacquired a 49% ownership stake in its Irish fabrication facility from Apollo Global Management for $14 billion — indicating CEO Tan’s commitment to the foundry strategy over the long term.
CFO David Zinsner disclosed to CNBC that advanced packaging services — representing one of Intel’s core competitive advantages — could generate billions in revenue per major client. Existing packaging customers include Amazon, Cisco, SpaceX, and Tesla.
