Intel delivered a blockbuster quarter that sent its shares up 5.2% in after-hours trade, reporting second-quarter revenue of $16.13 billion against analyst expectations of $14.42 billion — a 25% year-over-year surge powered by an unexpected boom in agentic AI.
Adjusted profit came in at 42 cents per share, double the 21 cents analysts had projected. The company's third-quarter guidance also crushed estimates, with Intel forecasting revenue between $15.8 billion and $16.8 billion versus the $15.1 billion consensus.
The results represent a critical vindication for CEO Lip-Bu Tan, who has staked his turnaround on regaining technology leadership against Nvidia and AMD. Tan told analysts on a conference call that second-quarter developments prompted Intel to become "fully committed" to high-volume production of chips built on its forthcoming 14A manufacturing technology in 2028 — a process Intel had previously warned might be abandoned without a major customer.
Agentic AI drives CPU renaissance
The shift toward autonomous AI agents — software that independently codes, researches, and executes tasks — has triggered a surprising resurgence in demand for traditional central processing units. Intel's leaders admitted earlier this year that the CPU order surge caught them off guard, with demand outstripping manufacturing capacity.
The company's Data Center and AI segment generated $6.26 billion in revenue, beating estimates of $5.37 billion. Its PC segment posted $8.88 billion versus the $7.89 billion expected.
Chief Financial Officer David Zinsner told Reuters that booming demand has prompted Intel to raise its 2026 capital expenditure forecast from $18 billion to $20 billion, with spending expected to rise meaningfully again next year. Intel has signed multi-year agreements with customers for both data center CPUs and specialized XPU chips, ranging from three to five years, some with both volume and price commitments.
Foundry business gains momentum
Intel's foundry business — the contract manufacturing arm that is central to Tan's turnaround — posted $5.77 billion in second-quarter sales, beating estimates of $5.55 billion. The unit secured Tesla as a customer for its 14A process for Elon Musk's "Terafab" AI chip project.
Intel shares have declined more than 25% from a record close on June 22 amid a broader chip stock selloff, but remain up more than 170% for the year. Rival chipmakers Arm Holdings and AMD also rose in extended trading on the positive Intel read-through.
