TL;DR
Intel Q2 revenue topped $16B with 25% growth, its fastest since 2011, but shares fell despite doubling earnings estimates
Intel posted second-quarter 2026 revenue of more than $16 billion, a 25 percent jump from a year earlier and the company’s fastest growth since late 2011. Adjusted earnings per share came in at 42 cents, double the 21-cent consensus estimate on Wall Street. Shares initially climbed on the results but reversed course during extended trading, deepening a 28 percent slide in July that has tested a stock still up more than 170 percent this year.
The data centre and AI division drove the beat, with revenue surging 59 percent year over year to more than $6 billion. Client computing, Intel’s PC chip business, rose 13 percent to nearly $9 billion, while the foundry arm posted revenue of nearly $6 billion, up 31 percent. Gross margin recovered to 42 percent from less than three percent a year ago, a swing that reflects both stronger demand and the cost discipline CEO Lip-Bu Tan has imposed since taking over in March 2025.
Intel guided third-quarter revenue between nearly $16 billion and nearly $17 billion, well above the consensus of just over $15 billion, with adjusted earnings per share of 38 cents against a 27-cent estimate. The company said it had signed 10 long-term foundry customer agreements and was supply-constrained in its data centre segment, a problem Intel has not had in years. Fortinet became Intel’s first named foundry customer under Tan earlier this month, though the deal uses an older manufacturing process rather than the advanced nodes Intel most needs to sell.
The results arrive as the US government holds roughly 10 percent of Intel after acquiring nearly $9 billion in shares at just over $20 each through a Chips Act agreement in August 2025. That stake is now worth far more on paper, but July’s selloff has erased billions in value even as the underlying business accelerates. Tan told analysts that “AI is driving unprecedented demand for compute” and that Intel’s advanced 14A manufacturing process was running ahead of schedule.
Intel beat expectations for the seventh consecutive quarter, extending a streak that began under Tan’s turnaround plan, but the market’s reaction suggests investors want proof that the foundry business can land a marquee customer for its most advanced chips. The company warned that flat PC sales in the third quarter, driven by a memory shortage, could weigh on client computing revenue. Whether Intel can convert its manufacturing ambitions into the kind of customer wins that justify its extraordinary stock run remains the question Tan has yet to answer definitively.
