Intel Shares Surge on Q1 Earnings Beat; U.S. Government Position Now Worth $35.4 Billion

Intel (INTC) shares surged more than 22% in pre-market trading Friday after the company reported first-quarter results that significantly exceeded Wall Street expectations. The rally highlights a recovery in Intel's core business, specifically within its Data Center and AI segment, while simultaneously creating a massive windfall for the U.S. government. The company reported first-quarter revenue of $13.6 billion, a 7% year-over-year increase, beating the $12.4 billion consensus. Non-GAAP earnings per share reached $0.29, a stark contrast to the projected loss of $0.01. Growth was primarily driven by the Data Center and AI division, which rose 22% to $5.1 billion as demand for Xeon processors accelerates alongside the broader AI infrastructure buildout. This price action has a profound impact on the U.S. government's holdings. Following an August deal where $8.9 billion in CHIPS Act grants and Secure Enclave funding were converted into 433.3 million shares at $20.47 each, the government now holds a 9.9% ownership stake. With shares trading near $81.80, the position is valued at approximately $35.4 billion, representing an unrealized gain of $26.5 billion. Furthermore, the government holds warrants to purchase an additional 5% stake at $20 per share, which are now deep in the money. CEO Lip-Bu Tan attributed the growth to a strategic shift in AI computing toward inference and agentic workloads, which he noted is significantly increasing the demand for Intel's CPUs. Looking forward, Intel provided second-quarter revenue guidance in the range of $13.8 billion to $14.8 billion.