Intel posts biggest quarterly sales jump in over 15 years as AI demand lifts results

On Thursday, Intel recorded its sharpest year-on-year rise in quarterly sales in more than a decade and a half, and how investors treated that result revealed as much about stretched expectations as about the company’s own performance.

For the second quarter of 2026, the semiconductor firm booked revenue of $16.13 billion, a 25.4 per cent increase from a year earlier and comfortably above the $14.42 billion Wall Street had pencilled in. Non-GAAP earnings per share reached $0.42, more than twice the $0.21 analysts had expected, with the outperformance spanning almost every metric the company had previously outlined to the market.

GAAP results painted a starker contrast. Intel reported a net loss of $2.16 a share under generally accepted accounting principles, reflecting a $12.53 billion non-cash charge linked to its CHIPS Act escrow structure — an accounting item that can leave a solid operating quarter looking poor if readers stop at the headline loss. Set that charge aside, and the operating story improves markedly.

Sales in the data centre unit, the division most closely connected to artificial intelligence infrastructure spending, climbed 59 per cent to $6.3 billion. The client computing segment, which still accounts for the bulk of Intel’s top line, advanced 13 per cent to $8.9 billion.

Looking ahead, management forecast third-quarter revenue between $15.8 billion and $16.8 billion and non-GAAP earnings per share of $0.38. The company also raised planned full-year capital expenditure to more than $20 billion, about $3 billion higher than its prior outlook. Most of the added spending is intended for equipment supporting the 18A and 18A-P process nodes, technologies central to chief executive Lip-Bu Tan’s push to establish Intel as a serious contract manufacturer for outside customers rather than solely a designer fabricating its own chips.

The report’s lasting interest lies in the gap between how far results cleared estimates and how the stock behaved afterward. Intel’s share price had already gained about 170 per cent year to date before the release, and more than 300 per cent over the prior twelve months, as investors anticipated a recovery of this kind. After the figures were published, the stock rose as much as 12 to 13 per cent in after-hours trading before surrendering more than half of those gains within hours, as holders who had already priced in a rebound locked in profits. A strong beat followed by a soft rally underscores that valuation still matters when the operational trend is favourable.

For those tracking Intel as a gauge of the wider AI infrastructure theme, the more lasting message sits in the operating path rather than the single-session price move. Management pointed to foundry yields of 85 per cent, a broader tie-up with Google Cloud, and an 18A manufacturing arrangement with a major cloud customer — signs that the turnaround has shifted from plan to delivery. Whether the equity can advance further now hinges less on Intel’s capacity to keep topping forecasts — something it has achieved for seven straight quarters — and more on whether investors will continue to pay a premium for a narrative already heavily reflected in the share price.