Intel reports earnings signals suggesting recovery in its competitive position as a US-based AI chip manufacturer.

Intel reported revenue of $13.6 billion in its latest quarter, representing a 7 percent increase from the same period a year earlier, though the company logged a $3.7 billion loss that was less than the market had anticipated. Shares soared more than 15 percent in after-market trades following the earnings announcement, and the company forecast revenue in the current quarter would range from $13.8 billion to $14.8 billion. The gains signaled potential recovery for the US chip maker, which has faced significant challenges in recent years.

Intel CEO Lip-Bu Tan attributed the improved performance to a new wave of AI development. "The next wave of AI will bring intelligence closer to the end user, moving from foundational models to inference to agentic," Tan said in the earnings release. "This shift is significantly increasing the need for Intel's CPUs and wafer and advanced packaging offerings." According to Tan, the AI trend of digital "agents" specializing in handling computer tasks independently creates demand for local network processing units rather than cutting-edge GPUs in datacenters.

Intel's recovery has been supported by major backing from tech industry leaders and the US government. Nvidia announced a $5 billion investment in its lagging rival, joining Japanese investment giant SoftBank in supporting the once-dominant chipmaker. President Donald Trump's administration took a 10 percent equity stake in Intel, recognizing the strategic importance of the company that powered the PC and internet revolution with its processors. This backing came as Intel has struggled to compete after missing key technology shifts, falling behind Asian manufacturers TSMC and Samsung in the custom semiconductor market, and being blindsided by Nvidia's rise as the world's leading AI chip provider.

Emarketer analyst Jacob Bourne highlighted the significance of the earnings results in shifting market perception. "Intel delivered the kind of report that the bulls needed to justify a stock that's soared over the past year, with data center momentum and foundry progress both pointing in the right direction," Bourne said. "These results make Intel's turnaround look less like a hope-fueled blip and more like a steadier longer-term trajectory." Tan, who took over as Intel CEO a year ago amid layoffs and market challenges, has acknowledged the difficulty of turning the company around, particularly as US-China trade tensions complicate the semiconductor landscape.