Intel shares surge 20% after Q1 earnings beat expectations
What's the story
Intel's shares surged by a whopping 20% in after-hours trading, following the company's first-quarter earnings report that exceeded Wall Street expectations. The chipmaker posted an adjusted earnings per share of $0.29 and revenue of $13.58 billion, both significantly higher than the expected figures of $0.01 EPS and $12.42 billion in revenue, respectively. However, Intel is still losing money. Its net loss widened to $4.28 billion from $887 million a year earlier.
Market response
Intel's stock has gained over 80% this year
Intel's stock has been on a winning streak, gaining over 80% this year after an impressive 84% rise in 2025. The company has drawn support from the Trump administration, which made the US government its largest shareholder last year to promote domestic chip manufacturing. Despite trailing behind competitors like NVIDIA and AMD in the early days of the AI boom, Intel is now seeing some momentum with a revenue increase of 7.2% from $12.67 billion last year.
Future outlook
Strong growth in data center business
For the second quarter, Intel expects revenue to be between $13.8 billion and $14.8 billion with an adjusted EPS of $0.20. This is well above analyst expectations of $13.07 billion in revenue and an EPS of $0.09. The company's data center business saw the strongest growth, with a 22% increase in revenue to $5.1 billion as demand for central processing units (CPUs) surged due to AI workloads shifting compute needs beyond NVIDIA's graphics processing units (GPUs).
Production approach
Intel's unique strategy sets it apart from competitors
Intel, an integrated device manufacturer, has a unique strategy of making its own products while also manufacturing the silicon that powers them. This is different from most chipmakers who outsource this complex and costly process to giant chip fabrication plants run by Taiwan Semiconductor Manufacturing Company. Intel is manufacturing its advanced 18A processors in Arizona, a node rivaling TSMC's 2nm technology. However, attracting outside clients remains difficult as Intel battles low yields and past production delays.
Packaging progress
Advanced packaging expected to generate billions per customer
Intel excels in advanced packaging, a process where individual chip dies are connected to a larger system. The company is one of only three global players providing this cutting-edge type of packaging. Intel is also aggressively pivoting toward its future 14A node, slated for 2028. Development is outpacing previous generations, and multiple customers are now evaluating the tech. Elon Musk recently revealed plans to use Intel's 14A process to make custom chips for Tesla vehicles and robots.