Intel reports second-quarter earnings on Thursday, and the numbers will test whether the chipmaker's stunning 185% rally this year has real legs—or is running on hype. Wall Street wants proof that forecast 12.1% revenue growth and new foundry customers can outweigh the drag from weak PC sales and profit margins far below their historic peaks.
Analysts expect Intel to report $14.42 billion in revenue and adjusted earnings of 21 cents per share, according to LSEG data. That would mark the company's fastest quarterly revenue growth in about six years. But the debate isn't just about the headline numbers. The stock has already fallen sharply from its June 22 record close, and investors are asking whether the turnaround story can deliver on its promises.
The Foundry Bet and PC Headwinds
Intel's push into the foundry business—manufacturing chips for other companies—is a central part of its comeback strategy. The company has announced new foundry customers, but the revenue from these deals takes time to materialize. Meanwhile, the PC market remains weak. After a pandemic-era boom, demand for laptops and desktops has slumped, and Intel's core business is still feeling the pinch.
Profit margins are another sore spot. Intel's margins are far below the levels they reached in previous years, when the company dominated the chip industry. The foundry business is capital-intensive, and the transition to new manufacturing processes has been costly. Analysts will be watching closely for any updates on margin guidance.
What It Means for Investors
For everyday investors, Intel's earnings report is a test of whether the stock's rally is justified by fundamentals. The 185% gain this year has been driven by optimism about the foundry strategy and a broader tech rally—seen in moves like the chipmakers driving a tech-led rally as the Nasdaq climbs 1.3%. But if earnings disappoint, the stock could give back more of those gains.
Investors should focus on three things in the report: revenue growth, margin trends, and any updates on foundry customers. Strong numbers could reassure the market that Intel is on the right track. Weak results, especially on margins, could reignite doubts about the turnaround timeline.
The broader market context also matters. Tech stocks have been volatile recently, with Asian stocks rallying as chipmakers rebound and oil prices rising on geopolitical risks. Intel's performance could influence sentiment across the semiconductor sector.
The Bottom Line
Intel's earnings are a pivotal moment for the stock. The company has promised a transformation, but investors want to see results. If the 12.1% revenue growth and new foundry customers can offset weak PC demand and thin margins, the rally may have more room to run. If not, the reality check could be painful.
As always, no single earnings report tells the whole story. But Thursday's numbers will give investors a clearer picture of whether Intel's comeback is on track—or if the stock has gotten ahead of itself.
