TLDR
- Intel shares fell 7.9% despite second-quarter revenue rising 25% to $16.1 billion.
- Data Center and AI generated about 71% of Intel’s total revenue growth during the quarter.
- Intel raised its 2026 capital expenditure plan to more than $20 billion, increasing investor concerns about cash flow.
- Intel Foundry recorded a $2.09 billion operating loss, while external customers contributed only about 5% of foundry sales.
- The company expects third-quarter revenue of about $16.3 billion and adjusted earnings of $0.38 per share.
Intel Corporation (INTC) shares closed Friday at $92.32, down 7.9%, after early gains faded. The decline came despite stronger second-quarter results and continued demand from data centers supporting artificial intelligence systems.
Intel stock reacted to concerns that rising investment could limit near-term cash gains. Revenue increased 25% from a year earlier to $16.1 billion. Adjusted earnings reached $0.42 per share, while non-GAAP net income totaled $2.2 billion.
AI Demand Drives Revenue and Operating Gains
Data Center and AI produced most of Intel’s growth during the quarter. The business added $2.323 billion in revenue, accounting for about 71% of the company’s total yearly increase.
Intel stock still benefited from stronger operating leverage. Companywide revenue rose by $3.269 billion, while adjusted operating income increased by $3.273 billion. This means added sales produced nearly the same amount of added operating profit, although the comparison followed weak 2025 results.
The quarter showed that demand remains firm across Intel’s main computing businesses. However, investors focused on whether planned factory spending will produce enough returns without weakening the cash position again.
Intel Foundry generated $5.8 billion in revenue but recorded a $2.089 billion operating loss. External customers contributed only $293 million, equal to about 5% of foundry sales. Altera’s move outside Intel supported part of that external revenue.
Intel stock faces added uncertainty because the 14A manufacturing process has no firm external demand commitments. Intel plans risk production in late 2027 and production in 2028. Continued losses may place more pressure on the company’s funding needs.
Intel Stock Faces Higher Capital Spending
Intel raised its 2026 capital expenditure plan from $18 billion to more than $20 billion. Management also expects spending to increase again in 2027 as the company adds capacity for rising computing demand.
Intel stock investors are now weighing growth against the cost of expansion. First-half operating cash flow exceeded property and equipment spending by $1.9 billion, compared with a negative $5.9 billion gap one year earlier. Customer deposits added $1.7 billion, while supplier prepayments reached $934 million.
The third-quarter outlook remains steady. Intel expects revenue between $15.8 billion and $16.8 billion, with a midpoint of $16.3 billion. Adjusted earnings are forecast at $0.38 per share.
Intel stock could remain sensitive to foundry losses, component shortages, and higher spending. Upcoming megacap earnings may show whether wider AI investment continues to support demand and cash flow across the chip sector. Intel stock performance will also depend on execution.
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