Intel (INTC) will report its second quarter earnings after the bell on Thursday, after the Philadelphia Semiconductor Index (^SOX) fell into a bear market last week following a run-up in shares of semiconductor stocks over the past few months.
On Tuesday, Intel confirmed it will lay off employees in its data center business, sending shares higher.
"As part of our broader strategy to become a more focused and efficient company, Intel's Data Center Group (DCG) is aligning its organization to ensure it has the right roles and skills in place to position the business for long-term success," an Intel spokesperson told Yahoo Finance.
"We are committed to treating all impacted employees with respect and providing resources to support them through this transition," they added.
Intel stock has rocketed since the start of the year, rising 184% as CEO Lip-Bu Tan continues an aggressive turnaround effort. The company has also benefited from investments by the Trump administration and Nvidia (NVDA), as well as an increased emphasis on central processing units (CPUs) as the tech industry turns toward AI agents.
Agents use CPUs to perform tasks such as combing through databases or creating documents. That has made the once-downtrodden chip far more popular after years of playing second fiddle to graphics processing units (GPUs).
"[Intel] is positioned to support 25-30% server CPU unit growth in 2026, benefitting from expanded capacity at [Intel] 3, robust demand from hyperscale and AI [infrastructure] deployments, and agentic AI increasing CPU intensity of AI clusters," KeyBanc Capital Markets' John Vinh wrote in a note to investors ahead of Intel's earnings.
Intel has also benefited from reports that its foundry business is beginning to sign on big-name customers. According to The Information, Google (GOOG, GOOGL) has placed an order with Intel to produce 3 million of its custom Tensor Processing Units.
The report said Nvidia is also looking into Intel as an option.
The moves come as Taiwan Semiconductor Manufacturing Co. (TSM) struggles to keep up with the immense demand from clients, including Nvidia, AMD (AMD), Apple (AAPL), and others, amid the AI boom. That gives Intel a prime opportunity to slide in as a secondary chip manufacturer to pick up the slack.
For the quarter, Intel is expected to report adjusted earnings per share (EPS) of $0.21 on revenue of $14.43 billion, up from the -$0.10 per share and $12.86 billion in revenue the company saw in the same period last year.
Intel's Data Center and AI segment is anticipated to generate $5.54 billion in the quarter, up 40% year over year. Intel's foundry business is expected to generate $5.48 billion in revenue.
Source: Yahoo Finance Top News — This article was automatically imported from the source. Read full article at original source →
