Intel Shares Surge as AI-Driven CPU Demand Fuels Earnings Beat

Intel (INTC) delivered a blowout first-quarter performance, reporting adjusted earnings per share (EPS) of $0.29, far surpassing analyst expectations of a near break-even quarter. Revenue reached $13.58 billion, beating consensus estimates by $1.16 billion. The surge is largely attributed to the evolving role of central processing units (CPUs) in the AI landscape. While graphics processing units (GPUs) dominate the intelligence phase, CPUs are increasingly vital for the data movement and workflow processes required for 'agentic AI'—autonomous agents capable of executing specific tasks. The company's data center business saw a 22% revenue increase, totaling over $5 billion for the quarter. CEO Lip-Bu Tan noted that customers are deploying server CPUs alongside accelerators at a ratio that favors CPUs, suggesting a structural growth engine for the franchise in the coming years. To solidify its position, Intel recently acquired the remaining 49% stake in its Ireland chip factory. Additionally, the company has hired a chief GPU architect to develop hardware capable of powering large language models (LLMs) to compete more directly with industry leader Nvidia. Following the announcement, Intel's stock climbed approximately 23.5% in early trading. The company's shares have risen over 280% over the past year as investors bet on its turnaround from a legacy chipmaker to an AI powerhouse. For the current quarter, Intel guided to adjusted EPS of $0.20 and revenue between $13.8 billion and $14.8 billion.