Intel prepared to release second-quarter results Thursday as investor enthusiasm for the chipmaker’s recovery narrative faces a test against actual financial performance. The company’s shares had climbed nearly three times higher for the year, reflecting renewed confidence in its turnaround strategy amid growing demand for artificial intelligence infrastructure.
Analysts anticipated Intel would report its fastest quarterly revenue growth in approximately six years, driven primarily by renewed demand for central processors increasingly used in AI applications. The expected revenue stood at $14.42 billion, representing 12.1% growth compared to the prior year, with adjusted earnings projected at 21 cents per share. The data center and AI segment was forecast to expand 36.4% to $5.37 billion. Investors also sought additional details regarding the contract manufacturing business, which had gained momentum through partnerships including an arrangement with Tesla.
A significant unknown heading into the earnings release centered on a potential manufacturing deal for Apple processors, which President Trump announced in April though neither Apple nor Intel had publicly confirmed the arrangement. Securing such a contract would strengthen Intel’s foundry operations and enhance its credibility as a contract manufacturer for major technology firms.
However, several headwinds tempered the optimistic sentiment. Intel shares had declined more than 25% from a record close on June 22 as part of a broader selloff affecting chip stocks, though the stock still remained 185% higher for the year. The company grappled with weakening personal computer market demand and adjusted gross profit margin pressures from significant foundry investments and manufacturing process ramp costs, with margins expected at 38.8%. Bernstein analysts noted cautious optimism about the company’s improving market narrative and supportive environment, while acknowledging that fundamental challenges persisted. In the prior quarter, tight industry capacity had allowed Intel to sell legacy and lower-specification products it had not anticipated moving.
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