Intel’s second-quarter revenue rose 25% to $16.1 billion—the fastest pace since 2011—driven by surging demand for data-centre processors in the agentic AI boom. Adjusted earnings per share of $0.42 more than doubled Wall Street forecasts, yet the company booked a net loss of $11 billion. Most of that loss stems from non-cash accounting charges tied to shares held in escrow for transfer to the U.S. government, part of a multi-billion-dollar subsidy deal that gave Washington a 9.9% equity stake in the chipmaker.

The result exposes the tension between strong operational momentum and the structural costs of Intel’s foundry strategy. Revenue from the Data Center and AI division jumped 59% year-on-year to $6.3 billion, while the legacy PC-chip business grew to $8.9 billion. The nascent contract-manufacturing unit, Intel Foundry, recorded a $2.1 billion operating loss but also secured Tesla as a customer for its advanced 14A process node. Chief Executive Lip-Bu Tan committed the company to “full-scale” 14A production by 2028, reversing an earlier warning that the technology could be abandoned without a major client. Chief Financial Officer David Zinsner raised the annual capital-expenditure forecast from $18 billion to $20 billion, signalling confidence that AI-driven orders will be sustained into next year.

Markets reacted swiftly: shares rose as much as 12% in after-hours trading, paring back recent losses that had knocked the stock down 28% in July alone. From Washington’s perspective, the results validate a strategy of using subsidies and equity stakes to shore up domestic semiconductor manufacturing. Yet analysts in London and São Paulo note that the net loss—the worst on record—risks overshadowing the operational turnaround if investors focus on the headline rather than the adjusted numbers. In Israel, where Intel operates fabrication plants, the data were read as evidence that demand for high-performance computing chips remains robust, offsetting weakness in low-end PC sales.

The company forecast third-quarter revenue of $15.8–$16.8 billion, well above the $15.1 billion consensus, and adjusted EPS of $0.38. That guidance, paired with long-term contracts for data-centre CPUs and specialised XPUs, suggests Intel expects the AI investment cycle to persist. The next milestone will be execution on the 14A roadmap and the ability of Intel Foundry to convert initial design wins into large-volume orders.