Intel Corp’s aggressive turnaround plan under chief executive Lip-Bu Tan is showing results as the US chipmaker reported stronger-than-expected earnings for the September quarter, driven by sweeping cost reductions and a string of high-profile investments.
Shares of the Santa Clara-based company jumped more than 8% in after-hours trading after Intel posted an adjusted profit of 23 cents per share, well above analysts’ expectations of 1 cent, according to LSEG data. Adjusted gross margins came in at 40%, also surpassing estimates of 35.7%.
This is Intel’s first quarterly report following multibillion-dollar investments from Nvidia, Japan’s SoftBank, and the US government. Nvidia plans to inject US$5 billion for a 4% stake once new shares are issued, while SoftBank invested US$2 billion in August. The US government, meanwhile, acquired a 10% stake worth US$8.9 billion after a politically charged meeting in Washington earlier this year.
Chief financial officer Dave Zinsner said the company has received the SoftBank funds but is still awaiting Nvidia’s investment. “We’re under shipping demand at this point, which I guess is a high-class problem,” he told Reuters, adding that demand for Intel’s chips was strong enough to create tight supply conditions.
Zinsner attributed the demand spike to data centre operators upgrading central processors to complement advanced AI chips, allowing improved performance for AI-driven applications.
Intel’s recovery comes after its share price plunged 60% last year amid market share losses to Advanced Micro Devices and repeated setbacks in the AI chip race. The stock has since rebounded nearly 90% in 2025, outperforming Nvidia’s despite its dominance in AI hardware.
“Shares popped after-hours based on better-than-feared guidance ex-Altera, visible cost and gross margin progress, AI-PC buzz, and US$15 billion of fresh strategic funding that shores the balance sheet,” said Michael Schulman, chief investment officer at Running Point Capital.
Since taking over, Tan has slashed costs and scaled back the manufacturing expansion plans of his predecessor, Pat Gelsinger, whose push to make Intel a global chip foundry competitor to Taiwan’s TSMC led to the company’s first annual loss since 1986. Intel said in July it would end the year with a workforce more than 20% smaller than last year.
For the current quarter, Intel expects revenue between US$12.8 billion and US$13.8 billion, with a midpoint of US$13.3 billion, broadly in line with analysts’ projections of US$13.37 billion.
Reuters
