Intel Beats Q1 Expectations with $13.6bn Revenue, Driven by Surging Data Center Growth
April 24, 2026
Intel Beats Q1 Expectations with $13.6bn Revenue, Driven by Surging Data Center Growth
Intel reported first-quarter 2026 revenue of $13.6 billion, surpassing analyst expectations and marking a seven percent year-over-year increase, signaling a potential turnaround for the struggling chipmaker. Shares surged 20 percent following the earnings release, reflecting growing investor confidence after five revenue declines in the previous seven quarters.
The strongest performance came from Intel’s data center business, which posted a 22 percent year-over-year revenue increase to $5.1 billion, with operating profit reaching $1.5 billion. This segment’s robust growth underscores the surging demand for computing infrastructure driven by artificial intelligence and cloud workloads. Intel Foundry also contributed to the quarter’s momentum, with revenue climbing 16 percent to $5.4 billion. Notably, the company’s ASIC segment nearly doubled year-over-year and grew 30 percent sequentially to just over $1 billion, while external foundry revenue reached $174 million.
For the second quarter of 2026, Intel forecast revenue between $13.8 billion and $14.8 billion, well above the analyst consensus of $13.07 billion. “Intel is now a very different company than when I first joined over a year ago,” CEO Lip-Bu Tan told investors on the earnings call. “We have taken, and continue to take, deliberate steps to rebuild Intel into a more competitive and more profitable company.”
Despite the revenue beat, Intel posted a net loss of $4.28 billion for the quarter, with Intel Foundry accounting for $2.4 billion of that deficit. The company has also faced significant executive departures over the past year, most recently Kevin O’Buckley, former SVP and GM of Intel Foundry Services, who left to join Qualcomm. Tan acknowledged ongoing challenges in meeting customer demand for CPUs, stating on the call: “There is huge demand. We are working very hard with our team to make sure we deliver, that we meet that demand, but we are still short because the demand keeps increasing from the customers.” He added that the foundry division is seeing more than seven percent yield improvement per month and is ahead of schedule for year-end targets.
Intel has been actively pursuing strategic partnerships to bolster its position. In February, the company entered a multi-year collaboration with SambaNova to deliver high-performance, cost-efficient AI inference solutions. In April, Google committed to multiyear Intel CPU deployments and agreed to collaborate on custom IPU developments. Intel also joined Tesla’s $20 billion TeraFab project in Austin, Texas, with Tesla CEO Elon Musk confirming plans to use Intel’s 14A chip manufacturing process at the facility. “We are super excited about working with Elon Musk, and we have very regular meetings,” Tan said. “He and I share the same vision that the whole global semiconductor supply did not keep pace with the rapid acceleration in demand.”
However, headwinds remain. CFO David Zinsner warned that “constraints and rising prices around key components like memory, wafers, and substrates are driving higher costs that could impact demand for our product at some point in the year.” The company also repurchased the 49 percent stake in its Fab 34 in Ireland for $14.2 billion, and has signed multiple long-term hardware deals to secure capacity. While Tan expressed confidence that CPUs will continue to drive growth in the years ahead, Zinsner noted that the global CPU shortage is expected to persist into fiscal 2026, reaching its lowest level in Q1 before gradually improving.
Source: datacenterdynamics
