Intel has increased its spending plans for the next two years as the AI data center boom drives demand for its central processing units (CPUs), according to reports discussing the company’s quarterly forecast. Intel also projected profits above analysts’ estimates on July 23.
Intel expects third-quarter revenue of between $15.8 billion and $16.8 billion, compared with analysts’ average estimate of $15.10 billion, according to data compiled by LSEG. Adjusted profit is expected to be 38 U.S. cents a share, compared with analysts’ estimates of 27 U.S. cents a share.
This comes as the chipmaker is benefiting from a boom in agentic AI in which autonomous agents carry out tasks such as computer coding on behalf of human users. Intel’s shares have declined more than 25% from a record close on June 22 amid a broader selloff in chip stocks, though shares remain up more than 170% for the year.
READ: Intel plans new job cuts after laying off 40,000 in the last two years (July 21, 2026)
On a conference call with analysts, Intel CEO Lip-Bu Tan said second-quarter developments prompted Intel to become “fully committed” to high-volume production of chips made with its forthcoming 14A manufacturing technology in 2028. Last year, the chipmaker had warned it might be forced to abandon 14A if it could not find a major customer, which would have effectively put the U.S. out of the race to make the world’s fastest chips.
“I’m pleased to see the increasing momentum on customer engagements for Intel 14A, and I’m increasingly confident that the 14A will be a highly competitive process,” Tan said.
Intel said that for the second quarter, ending in June 27, d sales rose 25.4% to $16.13 billion and adjusted profit was 42 cents per share, compared with estimates of $14.42 billion and 21 cents per share. Adjusted gross margin came in at 41.8%, versus estimates of 38.8%.
READ: Intel to retain networking and communications unit in ongoing restructuring (December 4, 2025)
“The stock can continue revaluing if Intel converts the current data center shortage into sustained revenue growth, improves foundry economics and finally announces the external customers needed to validate the next stage of the manufacturing turnaround,” said Shay Boloor, chief market strategist for tech research firm Futurum Group.
Earlier this week, Intel revealed it is preparing another round of layoffs, this time targeting its Data Center Group as the company continues a multi-year restructuring which has already led to a global workforce reduction by 40,000. While it is not clear how many jobs Intel plans to eliminate with the latest cuts, the chipmaker said they won’t affect its product commitments or roadmaps.