Intel reports 15-year record revenue growth driven by AI boom

Intel's Q2 revenue reached $16.1 billion, a 25% increase year-over-year and the highest growth rate since 2011, surpassing analyst forecasts of $14.42 billion. The server segment led with a 59% revenue jump to $6.26 billion, though still below the client segment's $8.9 billion, which grew 12.8% mainly due to higher average selling prices despite lower shipment volumes. Intel Foundry revenue rose 30.5% to $5.8 billion, but operating losses widened to $2.1 billion due to equipment investments. The company's overall profit margin improved to 40.4%, up nearly 13 percentage points from a year ago. CEO Lip-Bu Tan noted AI is driving computing demand, positioning Intel well in CPUs, ASICs, advanced packaging, and contract manufacturing. For Q3, Intel expects revenue between $15.8-$16.8 billion, above analyst estimates of $15.1 billion. The company has signed 10 long-term server CPU contracts, some with price terms, and demand still exceeds supply. In the client segment, Intel expects similar revenue as last quarter, with PC market growth hindered by memory shortages. Capital expenditure is now planned at $20-22 billion for this year, up from $18 billion, driven by equipment for new factories. Intel's 14A process is on track for mass production in 2028, and 18A-P is already in risk production. The company ended Q2 with $30 billion in cash and a $10 billion credit line, but reported a net loss of $11 billion primarily due to a government-related stock transfer.