Intel surpasses revenue forecasts as AI CPU demand offsets foundry build-out costs

Intel (NASDAQ:INTC) today posted first-quarter revenue that climbed 7% year-over-year, signaling a steadying of its core processor business even as the heavy costs of its foundry transition continue to weigh on GAAP profitability.

The Santa Clara-based chipmaker reported first-quarter revenue of $13.6 billion, exceeding its own guidance and analyst expectations.

On a non-GAAP basis, Intel earned $0.29 per share, comfortably ahead of the $0.01 consensus estimate.

However, under GAAP standards, the company reported a net loss of $0.73 per share, reflecting the massive capital intensity of its ongoing manufacturing "reset" and infrastructure depreciation.

The results were bolstered by a recovery in the Data Center and AI (DCAI) segment and sustained demand for Client Computing Group (CCG) products.

CEO Lip-Bu Tan, who assumed the top role in 2025, attributed the revenue beat to the "agentic" shift in AI, which has increased the industry’s reliance on Intel’s CPUs for inference tasks.

Intel Products revenue reached $12.8 billion, up 9% year-over-year, while the fledgling Intel Foundry business reported $5.4 billion in revenue, a 16% increase, though it remains a primary driver of operating losses.

Meanwhile, Intel’s 18A manufacturing process—a cornerstone of its plan to regain transistor leadership—is beginning to transition from the lab to the balance sheet.

The company recently launched its "Wildcat Lake" Core Series 3 processors, the first consumer products utilizing the 18A node.

Strategic partnerships with Google Cloud and participation in the "Terafab" AI initiative have further validated Intel’s architectural roadmap, though analysts caution that these high-profile wins may take several quarters to manifest as significant revenue.

Elsewhere, cash flow remained a bright spot, with $1.1 billion generated from operations during the quarter.

The company’s outlook for the second quarter of 2026 suggests continued momentum, with revenue projected between $13.8 billion and $14.8 billion.

Intel expects second-quarter GAAP EPS of $0.08 and non-GAAP EPS of $0.20.