Intel Posts Strongest Revenue Growth In 15 Years On Surging AI Demand

Intel nearly made a mockery of Wall Street estimates by blowing past expectations with $16.1 billion in second-quarter revenue, fueled by what company CEO Lip-Bu Tan called "unprecedented demand" for AI hardware. In doing so, Intel's revenue growth surged 25% year-over-year, which is the biggest gain in a decade and a half. Just as importantly, Tan is exuding confidence that the good times are just getting started.

"AI is driving unprecedented demand for compute, and as we continue to execute, Intel is well-positioned to capture sustainable growth across our CPU franchise, ASICs, advanced packaging and vast wafer foundry network," said Lip-Bu Tan, Intel CEO. "Our Q2 results represent our strongest revenue growth in more than 15 years, enabled by greater speed, accountability, and customer focus."

The rise of agentic AI and an industry-wide scramble to flesh out AI infrastructures has benefited major players in tech, including Intel, the timing of which could not be better. Tan, an industry veteran with decades of semiconductor and software experience, took over as CEO in March 2025, three months after Intel's board ousted Pat Gelsinger amid efforts to turn the company around.

Right from the get-go, Tan promised to focus on engineering, and for the most part he has been executing after a little more than a year at the helm. In Intel's latest earnings report, the company highlighted momentum to its reinvigorated Foundry business, with Intel 18A-P entering risk production right on schedule and Panther Lake achieving high-volume manufacturing using ASML's EXE High NA EUV technology.

These wins helped push Intel's Foundry revenue to $5.8 billion, up an impressive 31% from the same quarter a year ago.

Unsurprisingly, Intel's Data Center and AI (DCAI) division notched the chunkiest year-over-year revenue gain, skyrocketing 59% year-over-year to $6.3 billion in the second quarter of 2026. Meanwhile, Intel's Client Computing and Physical AI Group (CCPG) saw a more modest 13% year-over-year spike, though it was the top earner with $8.9 billion in revenue.

"We delivered a strong second quarter, exceeding our financial guidance on robust demand and improved execution, including volume upside driven by higher factory yields and improved cycle times," said Dave Zinsner, Intel CFO. "AI-driven compute continues to strengthen, and to support expected growth this year and next across products and foundry, we are meaningfully increasing our investments in equipment, clean room space, and substrates."

Looking ahead, Intel is confident that it can continue executing and meeting or exceeding expectations. In prepared remarks, Tan pointed to the company's x86 CPU franchise, advanced packaging technology, and vast wafer foundry network as three key reasons why he feels Intel is well positioned to maintain its current revenue momentum.

"My confidence in our foundry process roadmap has grown significantly since joining over a year ago. I am more confident than ever of the strategic significance and unique value proposition of Intel Foundry," Tan added.

He also acknowledged that Intel still has "a lot of work ahead" of it despite the strong quarterly results, though that's hardly a hedge. Looking to the third quarter, Intel anticipates revenue being between $15.8-$16.8 billion.