Intel delivered a blockbuster first quarter on Wednesday, posting $13.6 billion in revenue that handily beat Wall Street expectations of $12.36 billion and sent shares soaring roughly 25 percent in after-hours trading. The chipmaker's Data Center and AI division was the star of the show, pulling in $5.1 billion and locking in a 22 percent year-over-year gain that outpaced the $4.41 billion analysts had penciled in.
The Numbers That Matter
The results mark a dramatic turnaround for a company that spent much of 2024 and early 2025 watching from the sidelines as Nvidia dominated the AI chip narrative. First-quarter non-GAAP earnings per share came in at $0.29, crushing consensus estimates. For the second quarter, Intel guided revenue of $13.8 billion to $14.8 billion, well above the $13.03 billion analysts had forecast.
"Our Q1 results demonstrate the strength of our product portfolio and the accelerating demand for AI infrastructure across the enterprise," said Intel CEO Lip-Bu Tan during the earnings call. "We are seeing broad-based momentum in our data center business, driven by the transition to AI-optimized workloads."
AI-driven businesses now account for 60 percent of Intel's total revenue and grew 40 percent year-over-year, underscoring just how rapidly demand for AI infrastructure is reshaping the company's revenue base. The Xeon 6 processor line has emerged as a critical growth engine, winning design slots in major AI deployments.
Strategic Wins Pile Up
The quarter brought several landmark partnerships. Intel's Xeon 6 was selected as the host CPU for Nvidia's next-generation DGX Rubin NVL8 systems, a validation that even in an Nvidia-dominated AI hardware world, Intel's processors remain essential plumbing. The company also deepened its multiyear collaboration with Google Cloud for continued deployment of Xeon processors and co-development of custom AI infrastructure chips.
"What we are witnessing is the AI infrastructure buildout entering a new phase where CPUs matter as much as GPUs," noted Stacy Rasgon, a semiconductor analyst at Bernstein. "Intel is finally in the right place at the right time."
Perhaps most significantly, Intel's foundry business showed signs of life. The company confirmed that its 18A process node is ramping to high-volume production, with the recently announced Terafab partnership with Elon Musk's ventures adding another high-profile customer to the pipeline.
Why This Matters
Intel's results challenge the prevailing narrative that AI hardware is a one-horse race. While Nvidia still dominates GPU-based training workloads, the rapid expansion of AI inference at the edge and in enterprise data centers is creating a massive addressable market for CPU-based solutions. Intel's $5.1 billion DCAI quarter suggests that the AI infrastructure pie is growing fast enough for multiple winners.
The broader semiconductor industry is riding an unprecedented wave. Global chip revenue is on track to surpass $1.3 trillion in 2026, with AI accounting for an ever-larger share. Intel's ability to capture a meaningful slice of this growth, after years of market share losses, represents a genuine inflection point for the company.
What to Watch
The second-quarter guidance suggests Intel sees no slowdown in AI demand. Investors will be watching closely for updates on the 18A process node ramp, progress on the Terafab partnership, and whether the data center momentum extends into the second half. With the stock now near all-time highs, Intel faces the pleasant challenge of proving this quarter was the beginning of a trend rather than a one-off beat.
“Our Q1 results demonstrate the strength of our product portfolio and the accelerating demand for AI infrastructure across the enterprise.”— Lip-Bu Tan, CEO, Intel