Intel Corporation (NASDAQ: INTC) shares climbed 8.80% in after-hours trading to $109.05 after the company released its second-quarter 2026 earnings. The stock had closed the regular session at $100.23, down 2.33%, before reversing sharply on the results announcement. The quarter marked Intel's strongest revenue growth in more than 15 years, driven by accelerating demand for AI computing products and foundry services. The results come as Intel continues executing a turnaround strategy under CEO Pat Gelsinger, who returned to lead the company in 2021 after years of market share losses to AMD in client and server processors and to Nvidia in AI accelerators.

Intel Posts Strongest Revenue Growth in Over 15 Years

Intel reported second-quarter revenue of $16.1 billion, a 25% increase from $12.9 billion in the same period a year earlier. The company generated $7.0 billion in cash from operations during the quarter. Higher manufacturing efficiency and stronger product demand underpinned the overall financial performance. The double-digit growth represents a significant reversal for Intel, which saw annual revenue decline from roughly $79 billion in 2021 to approximately $54 billion in 2023 before beginning to stabilize.

Gross margin improved to 40.4% on a GAAP basis, up from 27.5% a year earlier. On a non-GAAP basis, gross margin reached 41.8%, while operating margin improved to 17.2%. Research, development, marketing, and administrative expenses all declined year over year.

GAAP results included a net loss of $11.0 billion, or $2.16 per diluted share. Non-GAAP net income reached $2.2 billion, or $0.42 per diluted share. The gap between the two figures reflected adjustments that excluded significant one-time items.

AI Products and Foundry Business Drive Quarterly Expansion

Intel Products generated $15.1 billion in revenue during the quarter, up 28% from the prior year. The Client Computing and Physical AI Group contributed $8.9 billion, a 13% year-over-year increase. The Data Center and AI segment surged 59% to $6.3 billion. That growth reflects heightened enterprise demand for AI infrastructure, a market where Nvidia's GPU platforms have dominated training workloads and where Intel has been positioning its Xeon and custom silicon offerings for inference and broader data center compute.

Intel Foundry reported $5.8 billion in revenue, representing 31% year-over-year growth. The company advanced its Intel 18A manufacturing process, with Intel 18A-P entering risk production on previously announced timelines. Intel also began high-volume manufacturing for selected Panther Lake processors using ASML High NA EUV technology. Intel is the first semiconductor manufacturer to integrate ASML's next-generation High NA lithography systems into production workflows, equipment it has highlighted as a competitive advantage in its effort to close the process-technology gap with TSMC, the global foundry leader.

The quarter reflected the impact of Altera's deconsolidation in September 2025, following Intel's sale of a 51% stake. Year-over-year comparisons no longer include Altera's operations beyond September 11, 2025, affecting segment comparisons across the company's financial statements.

Intel Expands AI Infrastructure and Manufacturing Capacity

During the quarter, Intel expanded its AI infrastructure portfolio with new rack-scale systems and disaggregated inference platforms. The company introduced Xeon 6+ processors built on Intel 18A technology for data center workloads and broadened its robotics strategy through OpenVINO Physical AI and wider adoption of Core Ultra Series 3 processors.

Intel also launched Arc G-Series processors for handheld gaming devices and expanded its Ethernet E835 networking portfolio. The company announced collaborations with Foxconn, Siemens, Hitachi, Fortinet, Echo Neurotechnologies, and Greenstone Biosciences to develop industry-specific computing solutions, supporting broader deployment of Intel processors and custom silicon platforms.

On the manufacturing front, Intel announced a €5 billion expansion to increase production of Xeon processors built on Intel 3 technology. The expansion aligns with a broader European push for domestic chip production capacity under the EU Chips Act, legislation adopted in 2023 to strengthen the region's semiconductor supply chain. The company also expanded capacity at its Bowers campus to support future process development and manufacturing. Leadership appointments across product, packaging, technology, legal, and operations were accompanied by a broader collaboration with Google Cloud to expand AI capabilities across Intel's internal workflows.