Intel (INTC) is set to report earnings after the bell Thursday, and its financial results could either solidify or rattle the chip stock’s 47% gain over the past month amid growing Wall Street optimism over the company’s long-awaited turnaround.
Rising demand for Intel’s traditional computing chips, called CPUs (central processing units), from data centers amid the rise of agentic AI and the launch of Intel’s Panther Lake chips for AI PCs prompted multiple investing firms including HSBC and KeyBanc to raise their ratings on Intel stock in the last few weeks. The moves — and recent support from President Trump — boosted shares, with the stock rising nearly 12% to hit its highest level in four years on Wednesday alone.
54.01 -0.24 (-0.44%)
As of 11:52:51 GMT-5. Market open.
Analysts will be closely watching Intel’s fourth quarter results, first quarter guidance, and executives’ commentary after the bell Thursday to gauge whether the company can sustain momentum in its data center server segment amid broader demand for computing power, capitalize on emerging interest in its AI PC processors, and demonstrate progress in its crucial manufacturing business, Intel Foundry Services.
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Despite more positive sentiment from Wall Street analysts on the chipmaker’s turnaround, Intel is projected to report earnings per share declining 33% from the previous year to $0.09 and revenue falling 6% to $13.4 billion, according to Bloomberg consensus estimates. Intel stock’s upswing despite the weak outlook shows investors hoping the results will be “ less bad than feared,” said Morningstar analyst Brian Colello.
The company — the only large-scale, leading-edge US chip manufacturer backed by the federal government and Nvidia (NVDA) — has faced mounting competition from AMD and Arm in its product business, adding to pressure on Intel as its manufacturing division strives to recover from years of setbacks.
One challenge Intel faces in the near term is the hefty cost of developing 18A and upcoming manufacturing process nodes, which are set to weigh on gross margins.
Noting the gap between Intel’s stock price surge and actual projections for the fourth quarter, Colello said, “ I think a lot of the upside in Intel [stock] is not about necessarily EPS for this quarter, but are they going to be on a path to be a sustainable business long term? The stock price suggests there’s at least a little more optimism about that.”
Another concern is that rising costs for memory and storage components used alongside Intel’s CPUs in data center servers and PCs could weigh on demand for systems built with Intel processors and hurt the chipmaker’s bottom line.
“If it wasn’t for the DRAM [memory] shortages and challenges, I think people would be very optimistic,” said TECHnalysis chief analyst Bob O’Donnell. “ The concern is that will those DRAM price increases limit companies’ desire to buy PCs?”
If the chipmaker can show strong AI-driven demand for its server CPUs and make meaningful progress securing key customers for Intel Foundry Services, the stock could extend its rally.
In HSBC analyst Frank Lee’s note upgrading Intel to Hold from Reduce, the analyst noted the manufacturing business’s “engagement with external customers is increasing,” while KeyBanc analyst John Vinh predicted the company could see Apple (AAPL) use its upcoming 14A process to make low-end iPhone chips in 2029.
Laura Bratton is a reporter for Yahoo Finance. Follow her on Bluesky @laurabratton.bsky.social. Email her at laura.bratton@yahooinc.com.
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