Intel earnings reveal significant operational turnaround

Intel reported Q2 2026 quarterly revenue of $16.1 billion on July 23, a 25% increase year-over-year from $12.9 billion in Q2 2025. That is the company’s strongest revenue growth in more than 15 years. Non-GAAP earnings per share came in at $0.42, against analyst expectations of approximately $0.21. The AI segment did the heavy lifting The Data Center and AI segment grew 59% year-over-year to $6.3 billion. The Client Computing segment added $8.9 billion, up 13% from a year ago. Gross margins came in at 40.4% on a GAAP basis, up 12.9 percentage points year-over-year. Non-GAAP gross margin reached 41.8%. CFO Dave Zinsner pointed to improved factory yields and faster cycle times as the explanation for that margin expansion. GAAP results still showed a net loss, driven by one-time items. What CEO Lip-Bu Tan is actually building CEO Lip-Bu Tan’s public messaging around the Q2 results emphasized AI-driven demand as the engine powering the recovery. Intel has been investing in building out external foundry capacity, including advancement of the Intel 18A process, as part of a broader foundry modernization effort begun when Tan took the helm in early 2025. What investors should actually wat...