Intel earnings test whether AI boom can sustain 186% rally

Intel will report second-quarter earnings Thursday after a remarkable stock run that has raised fresh questions about whether the gains reflect genuine AI-driven semiconductor demand or investor exuberance. Shares have climbed 185.77% year to date and 353.35% over the past year, though they sit 21.3% below the June peak, signaling some investor caution even as optimism persists.

Last quarter set a strong baseline. Intel posted non-GAAP earnings per share of $0.29 on revenue of $13.577 billion（約2.2兆円）, marking a 7.18% year-over-year increase and the sixth consecutive quarter beating revenue expectations. Within that total, Data Center and AI revenue jumped 22% to $5.052 billion（約8100億円）, and Foundry—Intel's new contract manufacturing business—grew 16% to $5.421 billion（約8700億円）. CEO Lip-Bu Tan told analysts that "the CPU is reinserting itself as the indispensable foundation of the AI era," pointing specifically to a shift in the CPU-to-GPU ratio in inference workloads from 1-to-8 toward 1-to-4. Analysts now expect the fastest quarterly revenue growth in about six years, driven by CPUs increasingly powering AI agents.

Three factors will determine whether the momentum holds. First is gross margin. TD Cowen analysts expect adjusted gross margin around 38.8%, still depressed by heavy foundry investments and the costs of ramping new manufacturing processes. Any breach above 41% would signal that Intel's massive capital spending is translating into operational leverage—a critical validation of the AI pivot's profitability. Second is the Apple question. President Trump announced in April a potential deal for Intel to manufacture processors for Apple, though neither company has publicly confirmed it. Any acknowledgment on Thursday's call would represent a foundry watershed: a major technology customer validating Intel's manufacturing capabilities in the AI era. Prediction markets already assign a 52% probability that Foundry revenue will exceed $6 billion（約9600億円）. Third is the PC drag. Intel management stated it is "prudently planning for PC demand to weaken in the second half," with full-year PC unit total addressable market expected down low double digits. Client Computing grew only 1% last quarter, and investors will scrutinize whether that line stalls further as data center accelerates, reshaping the company's revenue mix.

Intel's stock has delivered a stunning rally—up 185.77% year to date and 353.35% over the past year—but it now faces a reality check. The surge rests on a bet that CPUs, not just GPUs, are indispensable to AI workloads. CEO Lip-Bu Tan's statement that the CPU-to-GPU ratio in inference is shifting from 1-to-8 toward 1-to-4 suggests a narrowing performance gap that could sustain demand for Intel's data center processors. The last quarter's 22% jump in Data Center and AI revenue and six consecutive quarters above revenue expectations support this narrative. However, the rally has run ahead of a margin story that remains unproven: Intel is investing heavily in new foundries and manufacturing processes, pressuring adjusted gross margin to an expected 38.8%, well below the 41% threshold analysts see as a sign that the AI pivot is delivering operational leverage.

The Apple angle adds another dimension. A foundry deal would validate Intel's $20+ billion pivot toward manufacturing and signal that a major technology customer sees Intel as a viable processor supplier in the AI era. Prediction markets already price a 52% chance that Foundry revenue exceeds $6 billion（約9600億円）, suggesting investors believe an Apple deal—or a similar high-volume win—is plausible. Yet both companies have remained silent despite Trump's April announcement, leaving Thursday's call as a potential inflection point. Simultaneously, Intel faces a structural headwind in PCs, where demand is expected to decline low-double-digits in the full year, threatening to offset data center strength if the Client Computing segment stalls further after growing just 1% last quarter.

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