INTC FY2026 Q1 Improving

Intel Corporation earnings call

Apr 23, 2026 · 13:00 ET David ZinsnerJohn PitzerLipu Tan earningscall_biz

Buzzberg read

CPU demand from AI driving strong server growth

Intel's Q1 FY2026 results beat expectations across revenue, gross margin, and EPS, driven by strong demand for server CPUs (Xeon) and improving 18A yields. Management raised Q2 guidance and highlighted a multi-year CPU growth cycle from AI inference. Key cross-company signals include Google as a new LTA customer, NVIDIA's selection of Xeon for DGX Rubin, and a TeraFab partnership with Tesla and xAI. Supply constraints remain a multi-billion dollar headwind. Q1 revenue of $13.6B (+$1.4B vs guide midpoint), gross margin 41% (+650bps vs guide), EPS $0.29 vs breakeven guide.

Buzzberg read CPU demand from AI driving strong server growth Intel's Q1 FY2026 results beat expectations across revenue, gross margin, and EPS, driven by strong demand for server CPUs (Xeon) and improving 18A yields. Management raised Q2 guidance and highlighted a multi-year CPU growth cycle from AI inference. Key cross-company signals include Google as a new LTA customer, NVIDIA's selection of Xeon for DGX Rubin, and a TeraFab partnership with Tesla and xAI. Supply constraints remain a multi-billion dollar headwind. Q1 revenue of $13.6B (+$1.4B vs guide midpoint), gross margin 41% (+650bps vs guide), EPS $0.29 vs breakeven guide. Read full analysisCollapse analysis

Q2 guidance: revenue $13.8-$14.8B, gross margin 39%, EPS $0.20; sequential growth driven by DCAI (double-digit) and supply expansion.
Server CPU demand surging as AI inference shifts CPU-to-GPU ratio from 1:8 toward parity; Intel's Xeon selected as host CPU for NVIDIA's DGX Rubin.
Google signed a multi-year LTA; other LTAs with undisclosed customers; backlog in advanced packaging running at billions of dollars per year.

ALL_OTHER Revenue$0.628BReported

CCG Revenue$7.7BReported

DCAI Revenue$5.1BReported

FOUNDRY Revenue$5.4BReported

6 grounded callouts

What matters now

The highest-signal changes from the call.

CPU demand from AI driving strong server growth

Supply

Demand outpaces supply across all businesses

Foundry

18A yields improving faster than expected

Show 3 more callouts

Guidance

Full year PC TAM expected down low double digit

Foundry

Advanced packaging backlog in billions of dollars

Demand

Server CPU demand outlook improved over 90 days

Reported period

Actuals

Metric	Reported	Change
ALL_OTHER Revenue	$0.628B	Reported
CCG Revenue	$7.7B	Reported
DCAI Revenue	$5.1B	Reported
FOUNDRY Revenue	$5.4B	Reported
Revenue	$13.577B	-1% QoQ
EPS	$0.29	Reported

Forward-looking

Forward guidance

Metric	Period	Range	Midpoint	Status
EPS	FY2026 Q2	$0.20	$0.20	Guided
Gross margin	FY2026 Q2	39%	39%	Guided
Revenue	FY2026 Q2	$13.8B–$14.8B	$14.3B	Guided

AI, capex & demand read

Management read

Tone

Confident

Management repeatedly expressed confidence in demand, execution, and competitive positioning, citing six consecutive quarters of exceeding expectations and strong demand outstripping supply.

Management AI read

Management emphasized that the CPU is re-inserting itself as the indispensable foundation of the AI era, with AI driving strong demand for Xeon server CPUs and AI-related businesses now representing 60% of revenue, growing 40% year over year. They also highlighted AI-driven demand for advanced packaging and foundry services, and partnerships like with Samba Nova for AI inference architectures.

Capex

Investment and capacity

Capex guidance for 2026 is now flat year over year, up from prior expectation of flat to down, reflecting increased capacity investments to support committed demand. Tool spending is up about 25% year over year, while space spend is being reduced. The company is also investing in Intel 14A and expanding back-end facilities in Malaysia to support future demand.

all 9 named companies below

Companiesreturns since call

Customers

GOOGL +12.3%

Customers

Google signed a long-term agreement (LTA) for Xeon and ASIC, signaling sustained demand for Intel's server CPUs and foundry services.

Evidence

“Google is one of the multi-long-term contract agreement in Q1. And this is significant. Google, we have the Xeon IPO and building a long-term trusted partnership, which is very important for us.”

Lipu Tan

NVDA +8.9%

Customers

Advanced packaging demand is running at billions of dollars per year, far above initial expectations, and is a differentiated, high-margin foundry offering. — Intel's advanced packaging (e.g., EMIB, Foveros) is in heavy demand from AI chip designers (including NVIDIA and AMD), creating a new revenue stream and reducing reliance on TSMC for packaging.

Evidence

“Xeon 6 was selected as the host CPU for NVIDIA's DGX Rubin NVL8 systems, and Xeon remains the most deployed host CPU due to its industry-leading memory, security, and networking orchestration.”

David Zinsner

Partners

TSLA -12.6% XAI.PVT

Partners

Intel is collaborating with Tesla (and xAI) on TeraFab, exploring unconventional silicon manufacturing efficiency; could lead to new foundry revenue streams.

Evidence

“We recently announced our partnership with SpaceX, XAI, and Tesla to support TeraFab.”

Lipu Tan

Suppliers

TSM +9.7%

Suppliers

Intel maintains a strategic multi-foundry relationship with TSMC, using its capacity to supplement internal supply; implies Intel's product groups may still outsource to TSMC.

Evidence

“TSMC is a very important partner for us. Maurice and CC have decades of friendship. And then clearly, we know our product group will decide, you know, which is the best foundry.”

Lipu Tan

Competitors

ARM +29.4%

Competitors

Intel acknowledges ARM as a long-term competitor in server CPUs, but points to ARM's rising licensing costs as a potential weakness.

Evidence

“we know ARM a lot... They have a licensing model. They have been very effective. And, of course, they continue to have to raise the loyalty fee.”

Lipu Tan

Supply chain

AMZN

Supply chain

Amazon's Graviton (ARM-based) is a competitive threat to Intel in the data center; Intel notes that hyperscalers are adopting ARM.

Evidence

“some of the Amazon, Google, they are using that [ARM].”

Lipu Tan

AMD

Supply chain

Evidence

“Lipu had a target as we came into the year for the end of this year. And, you know, we're probably going to hit that probably the middle of this year.”

David Zinsner

MU +85.0%

Supply chain

Rising memory and substrate costs are a growing headwind to Intel's gross margins in the second half of 2026. — Input cost inflation (especially memory from Micron and others) will pressure Intel's margins, potentially limiting the upside from better yields and mix.

David Zinsner

External signals

Supply-chain alpha · 4returns since call

Intel is leaving billions of dollars in revenue on the table due to supply constraints; it could not fulfill all customer demand in Q1.

David Zinsner

AMD NVDA+8.9%

Intel 18A yields are improving faster than expected, hitting year-end target by mid-year, which accelerates the ramp of Panther Lake and reduces early-stage cost drag.

David Zinsner

AMD

Advanced packaging demand is running at billions of dollars per year, far above initial expectations, and is a differentiated, high-margin foundry offering.

David Zinsner

NVDA+8.9%AMD

Rising memory and substrate costs are a growing headwind to Intel's gross margins in the second half of 2026.

David Zinsner

MU+85.0%

Methodology & coverage

Management-only analysis. All 9 validated company mentions are shown. Reported actuals and forward guidance are kept separate. Public evidence is limited to eight short attributed quotes. AI-generated analysis can be incomplete or wrong; verify important claims against the original source.