Intel Posts Its Fastest Growth Since 2011 — and an $11 Billion Loss on the Same Day

Intel reported second-quarter revenue of $16.1 billion on Thursday afternoon, beating the $14.42 billion consensus and rising 25% year over year — its fastest growth in more than fifteen years. The stock rose 11% after hours, to roughly $110, on top of a gain of about 163% already this year.

Two sets of books

On a non-GAAP basis Intel earned $0.42 per share against $0.21 expected, on net income of $2.2 billion. On a GAAP basis it lost $11.0 billion, or $(2.16) a share — the result of a $12.5 billion mark-to-market loss on the shares held in escrow under its CHIPS Act award. Gross margin was 40.4% GAAP and 41.8% non-GAAP, up roughly 12 points either way.

Where the growth came from

Data Center and AI revenue was $6.3 billion, up 59%. Client Computing and Physical AI came in at $8.9 billion, up 13%. Intel Foundry booked $5.8 billion, up 31%, though external foundry revenue — the part that counts as a real merchant business — was only $293 million, up from $174 million in Q1. The foundry unit lost $2.09 billion in the quarter, an improvement of $348 million sequentially.

Supply, not demand, is the constraint

CEO Lip-Bu Tan told analysts that "strong demand for our products continues to outpace our growing supply," and floated a total addressable market "potentially over $100 billion." CFO Dave Zinsner was blunter about the shortfall: "We will not catch up in the fourth quarter." Intel raised 2026 capital spending from $18 billion to more than $20 billion, and said 2027 would be significantly higher. It has signed 10 long-term contracts with server CPU buyers.

Process

18A-P entered risk production and Panther Lake is in high-volume manufacturing using ASML High-NA EUV. Xeon 6+ shipped as the first server product on 18A. Intel guided Q3 revenue to $15.8-16.8 billion. Headcount stands at 82,300.