Intel stock jumps 11% on fastest revenue growth in nearly 15 years

Intel Corporation reported its fastest revenue growth in nearly 15 years, driven by surging demand for artificial intelligence chips, sending its stock up 11% in after-hours trading. The chipmaker posted second-quarter revenue of $12.8 billion, beating analyst estimates of $12.1 billion, and issued an optimistic third-quarter forecast that exceeded Wall Street expectations.

The strong performance was fueled by a 15% jump in data center revenue to $3.2 billion, as cloud providers and enterprises increasingly adopt Intel's processors for AI workloads. The company's client computing group, which supplies chips for PCs, also saw a 9% rise to $7.4 billion, reflecting a broader recovery in the PC market.

Intel's turnaround comes after a prolonged slump, with the company losing market share to rivals like AMD and Nvidia. The results mark the first time Intel has beaten revenue expectations in over a year, signaling that CEO Pat Gelsinger's strategy to refocus on manufacturing and AI is gaining traction. The company's adjusted earnings per share came in at 13 cents, compared to the expected 10 cents.

For the third quarter, Intel forecast revenue between $12.9 billion and $13.9 billion, above the consensus estimate of $12.2 billion. The upbeat outlook suggests that the AI boom is providing a sustained lift to Intel's core businesses, even as it continues to invest heavily in new chip fabrication plants and technology.

Investors are now watching for Intel's progress in its foundry business, which aims to manufacture chips for other companies. The company has secured several key customers, but the unit remains unprofitable. Gelsinger has said he expects the foundry to break even by 2027. The strong quarterly results could buy Intel more time to execute its long-term turnaround plan amid fierce competition in the semiconductor industry.