Intel Stock Rallies 4% on Q2 Earnings Beat, AI Demand Surge July 24

Intel delivered a surprise earnings beat on July 23, posting $16.1 billion in second-quarter revenue, 25% higher than a year ago and well above the $14.42 billion analyst consensus. Adjusted earnings per share hit 42 cents, double the 21-cent estimate. The stock rose 4% in after-hours trading as CEO Lip-Bu Tan credited AI infrastructure demand for the surge. For Singapore investors tracking the semiconductor sector, this marks Intel’s fastest revenue growth in nearly 15 years.

Why Intel’s earnings crushed expectations

Intel’s data center revenue jumped 60% year-over-year to $6.3 billion, versus analyst estimates of $5.54 billion. Client computing revenue reached $8.9 billion against forecasts of $7.99 billion. CFO David Zinsner said the company is supply-constrained, with data center customers demanding more chips than Intel can produce. AI-driven compute continues to strengthen, he noted, as companies race to build out infrastructure for agentic AI systems that automate tasks like coding and database searches.

Forward guidance beats analyst forecasts

Intel expects third-quarter revenue between $15.8 billion and $16.8 billion, well ahead of the $15.1 billion consensus. Adjusted profit is projected at 38 cents per share versus analyst estimates of 27 cents. The company is also boosting capital spending over the next two years to support expected growth in both products and foundry operations. Tan said Intel is becoming fully committed to high-volume production of its 14A manufacturing technology by 2028, a process that competes directly with rivals like Nvidia and AMD.

Long-term customer contracts lock in demand

Intel has signed 10 long-term agreements with data center customers, some with pricing locked in and others focused on chip volume. This strategy mirrors moves by memory vendors to preserve pricing power if the AI market cools. Zinsner emphasized that customers continue to signal strong and sustainable spending on compute infrastructure, suggesting the AI boom will persist beyond the near term.

Meyka data shows caution despite earnings beat

While earnings impressed, Meyka grades Intel a C with a Sell recommendation, citing weak fundamentals. The stock trades at a PE ratio of 175.84, well above historical norms, and Meyka’s DCF, ROE, and ROA scores all rank in the bottom tier. However, analyst consensus remains bullish: 7 Buy ratings and 7 Hold ratings versus no Sell ratings. Meyka’s 12-month price target of $124.19 sits 24% above the current $100.23 price, though the stock has already fallen 24% in July from its June 22 peak of $142.35.

Final Thoughts

Intel’s earnings beat and strong guidance offer a genuine growth story in AI infrastructure, but Meyka’s C grade and elevated valuation warrant caution. The stock remains up 171% year-to-date despite recent weakness, leaving limited margin for error if AI spending disappoints.

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The content shared by Meyka AI PTY LTD is solely for research and informational purposes.  Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.