Intel stock surged 11% in extended trading after the chipmaker reported second-quarter 2026 revenue of $16.1 billion, up 25% year-over-year, marking its fastest revenue growth in nearly 15 years and beating analyst expectations of $14.42 billion.
The earnings beat was driven primarily by a 59% surge in Intel’s data center and AI revenue to $6.3 billion, as artificial intelligence infrastructure demand continues to accelerate. Intel CEO Lip-Bu Tan said in a statement that “AI is driving unprecedented demand for compute” and that the company is “well-positioned to capture sustainable growth across our CPU franchise.”
Intel reported adjusted earnings per share of 42 cents, far exceeding the 21-cent consensus estimate. The company’s gross margin also recovered sharply to 42%, compared to just 2.5% in the year-ago period, reflecting higher-margin product sales and improved manufacturing efficiency as the company scales production.
The client computing group, which produces chips for personal computers, also posted solid results with revenue rising 13% to $8.9 billion. However, Intel said it expects flat PC sales in the third quarter because of memory shortages affecting the broader industry. The foundry business, where Intel manufactures chips for external customers, generated $5.8 billion in sales, up 31% on an annual basis, though the company has yet to secure a major named customer for advanced manufacturing.
For the third quarter, Intel raised its guidance to revenue between $15.8 billion and $16.8 billion, above analyst expectations of $15.1 billion, and projected adjusted earnings per share of 38 cents versus the 27-cent consensus estimate. The company also disclosed it has signed 10 long-term agreements with data center customers for server CPUs, with some featuring locked-in pricing—a strategy becoming common in the semiconductor industry as vendors try to preserve high margins in case AI demand moderates.
Intel’s strong quarter comes as the company has beaten earnings expectations for six consecutive quarters. The stock is up over 170% in 2026 so far, though it had slumped 28% in July before the earnings announcement. The recovery reflects Intel’s turnaround under CEO Tan, who took the helm in December 2023 and has focused the company on capturing the AI infrastructure boom while revamping its foundry business to compete with Taiwan Semiconductor Manufacturing Company.
Analyst Christopher Rolland at Susquehanna raised his price target for Intel stock from $80 to $115 ahead of the earnings report, citing expectations for a solid quarter driven by data center growth. The broader semiconductor sector has benefited from the AI infrastructure buildout, with companies like Dell reporting sustained AI server demand and strong stock gains this year.
Intel stock’s extended-hours surge reflects investor confidence in the chipmaker’s ability to capitalize on AI demand despite competitive pressures from AMD and other rivals. The company faces challenges including the delayed rollout of its advanced 14A manufacturing process and continued losses in its foundry division, but the strong data center results suggest the core CPU business remains resilient in the AI era.
Sources
- CNBC — Intel Q2 2026 earnings report, revenue of $16.1 billion up 25%, EPS of 42 cents adjusted, stock surge, guidance, and CEO commentary
- StockTitan — Intel Q2 2026 revenue of $16.1 billion, gross margin improvement to 40.4%, year-over-year growth metrics
- Yahoo Finance — Analyst commentary from Susquehanna’s Christopher Rolland on Intel price target and earnings expectations
- Investopedia — Intel Q2 2026 earnings preview and analyst expectations for revenue growth and data center performance
