Dive Brief:
- Intel Corp. saw revenue reach $16.1 billion in the second quarter, up 25% from a year ago, marking its strongest growth in more than 15 years, CEO Lip-Bu Tan said on an earnings call Thursday.
- The growth came largely from Intel’s products for data center and artificial intelligence customers, which surged to $6.3 billion in revenue — up 59% from last year. At the same time, revenue improved by double-digits across its foundry division and client computing and physical AI group of products.
- Tan said strong demand continued to outstrip Intel’s growing supply during the three months that ended June 27. The company raised its 2026 capital spending to more than $20 billion, up from a previous range of $17 billion to $18 billion, for continued investment in advanced manufacturing and packaging.
Dive Insight:
As companies look to build out AI infrastructure, they are facing a severe shortage of silicon wafers, memory chips and substrate materials used for smart phones, laptops, data center servers and other devices. This has pushed prices up and challenged companies.
At the same time, Tan said surging demand “creates a meaningful opportunity” for Intel’s foundry and product divisions.
Intel is looking to benefit from its x86 processors, advanced packaging technology and foundry network as AI progresses from training and inference to agentic and multiagentic systems, Tan said.
To meet this demand, Intel plans to increase its investments through 2027, with the “vast majority” geared toward its U.S. network, CFO David Zinsner said on the call. Focus areas will include rapidly expanding clean room space, equipment orders from vendors and securing supplies of substrates and memory, he said.
“I’m confident in our ability to leverage our broad IP portfolio to solve our customers’ most pressing needs,” Zinsner said.
Tan highlighted progress he’s seen across Intel’s foundry operations since first joining the company in March 2025, including improved yields and better cycle times for its Intel 7, 3 and 18A process methods called nodes.
During the quarter, Intel saw 18A chip yields “increase meaningfully” and has begun ramping up new products, including Panther Lake and Wildcat Lake used for mobile devices and budget laptops, respectively. The company also began trial runs of 18A-P, an improved version of 18A.
Additionally, Tan said there is “increasing momentum” for next-generation node Intel 14A from customers. The company is on track to begin trial runs for its internal products in the second half of 2027, with the goal of entering high-volume production in 2028, he said.
Intel recently renamed its personal computer business to focus on AI growth opportunities as well, referring to it as the client computing and physical AI group. With the change, Intel appointed Alex Katouzian to lead the division.
The company also recently appointed Pushkar Ranade as chief technology officer, Seok-Hee Lee to lead Intel’s advanced packaging operations and Aparna Bawa to lead the company’s global legal, ethics, compliance, people and culture organization.
Looking ahead, Intel is expecting its third quarter revenue to range between $15.8 billion and $16.8 billion. Zinsner said supply remains tight, and near-term growth is skewed toward the end of the third quarter and into the fourth quarter.
At the same time, Intel anticipates personal computer products to be “subseasonal” in the second half of the year and for server processor demand to continue improving through 2028, he said.
