Intel Stock Surges After Strong Earnings and AI Demand
Shares of Intel surged more than 26% on Friday, climbing to around $84.50 and reaching a new all-time high. The rally followed stronger-than-expected quarterly results and an upbeat outlook driven by rising demand for AI-focused data center chips.
The stock move also pushed Intel above its previous peak from the dot-com era, marking a major milestone for the company after years of underperformance.
Strong Outlook Beats Wall Street Expectations
Intel projected second-quarter 2026 earnings per share of $0.20, significantly above analyst expectations of $0.09. Revenue is expected to range between $13.8 billion and $14.8 billion, also ahead of the $13.04 billion consensus estimate.
The guidance reflects strong momentum in server chips used in artificial intelligence infrastructure.
AI Boom Drives Revenue Growth
In the first quarter, Intel reported revenue of $13.6 billion, up 7% year-over-year and above analyst forecasts of $12.41 billion. Growth was particularly strong in the data center and AI segment, where revenue jumped 22% to $5.1 billion.
Earnings per share came in at $0.29, far exceeding expectations of just $0.02, highlighting improved operational performance.
Turnaround Strategy Gains Traction
After years of struggling to compete in the AI space, Intel has been executing a turnaround strategy under CEO Lip-Bu Tan. The plan includes asset sales, cost reductions, and strategic investments aimed at strengthening the company’s financial position.
Intel has also secured partnerships with major players, including SoftBank Group and NVIDIA, as well as support from the U.S. government to expand its manufacturing capabilities.
New Deals Signal Manufacturing Breakthrough
In a notable development, Elon Musk revealed that Tesla plans to use Intel’s next-generation 14A manufacturing process for chips in its Terafab AI project in Austin.
This could represent Intel’s first major customer for its advanced manufacturing technology, a key step in competing with industry leader Taiwan Semiconductor Manufacturing Company.
Analyst Reaction and Market Outlook
Analysts at Stifel raised their price target on Intel following the strong results, citing better-than-expected execution. However, they cautioned that margin improvements may remain uneven and that challenges still lie ahead.
Expanding AI Partnerships
Intel has also deepened its collaboration with Alphabet, focusing on deploying Intel Xeon processors across Google’s infrastructure. The partnership includes co-developing custom AI chips designed to improve efficiency and scalability for large workloads.
