Intel just delivered its first earnings report since the U.S. government became a major shareholder, beating revenue estimates with $13.65 billion against the $13.14 billion expected. The chipmaker's stock jumped 6% in after-hours trading as demand for its core x86 PC processors showed clear signs of recovery, marking a pivotal moment for the company's government-backed turnaround.
Intel just proved the government made the right bet. The chipmaker's third-quarter earnings, released Thursday evening, showed revenue of $13.65 billion - comfortably beating the $13.14 billion analysts expected and sending shares up 6% in extended trading.
This marks Intel's first quarterly report since the Trump administration negotiated an $8.9 billion investment in August, purchasing 433.3 million shares at $20.47 per share. The government's stake fundamentally changes Intel's shareholder structure, though it created some unusual accounting headaches that CEO Lip-Bu Tan acknowledged during the earnings call.
"We are fully committed to advancing the Trump administration's vision to restore semiconductor production and proudly welcome the US government as an essential partner in our efforts," Tan told investors, according to CNBC's earnings coverage.
The real story isn't just the government money - it's that Intel's core business is actually recovering. The company's Client Computing Group, which makes processors for PCs and laptops, generated $8.5 billion in revenue as part of the broader $12.7 billion products group sales. More importantly, Intel says chip demand is outpacing supply, a trend expected to continue through next year.
This supply constraint represents a dramatic turnaround for a company that was struggling to compete against AMD in recent years. The PC market's recovery, driven partly by AI-enhanced laptops and corporate refresh cycles, is giving Intel breathing room to execute its broader strategy.
But Intel's transformation story got more complex in September when former rival Nvidia invested $5 billion in the company. The partnership will integrate Intel's central processors with Nvidia's AI graphics chips, which dominate 90% of the AI processor market. For Intel, this represents a chance to revive its struggling data center CPU business, which posted $4.1 billion in sales but declined 1% year-over-year.
The Nvidia deal also highlights Intel's strategic pivot. Rather than trying to compete head-to-head in AI chips, Intel is positioning itself as the foundational computing layer that enables AI workloads. It's a pragmatic approach that plays to Intel's manufacturing strengths while acknowledging Nvidia's AI dominance.
