July 24, 2026, (Inside AI) — Intel shares surged 6% in premarket trading Friday after the company issued third-quarter revenue guidance that beat Wall Street expectations and raised its annual capital expenditure forecast to $20 billion, up from $18 billion. The bullish outlook signals that the AI boom is finally fueling a turnaround for the storied chipmaker.
The company’s improving prospects are rooted in growing adoption of its data center central processing units (CPUs) by customers building AI infrastructure. CEO Lip-Bu Tan is positioning Intel to capture broader AI-driven semiconductor demand, even as Nvidia dominates accelerator chips.
“The capex increase not only signals confidence in cash flow upside and demand visibility from long-term agreements for products, but also confidence that Foundry customers are coming (for packaging and 14A wafers),” analysts at Melius Research said.
Intel’s raised capex underscores its bet on a manufacturing resurgence. The company is central to Washington’s push to revive domestic chip production, and Tan has spent the past year shoring up finances and securing government backing.
“The aggressive capex raise is a proof point that Intel is likely to see continued customer acquisition as the United States demands more domestic semiconductor manufacturing,” D.A. Davidson analysts said.
The data center CPU surge is tied to the rise of AI agents, with Intel executives earlier this year noting that orders were outpacing production capacity. This aligns with industry data showing a 40% year-over-year increase in server CPU shipments for AI workloads, according to a recent report by SEMI.
Intel’s foundry ambitions are also gaining traction. The company’s 14A process node, expected to enter production in 2027, has reportedly attracted interest from major fabless firms seeking alternatives to TSMC. A research paper from arXiv highlights Intel’s advanced packaging technologies as critical for scaling AI accelerators.
Despite this month’s global chip stock selloff pulling Intel off record highs, shares have more than doubled this year. At least six analysts raised price targets after the results, with the median target now about 8.8% above the last close, per LSEG data.
However, Intel’s path remains fraught with execution risks. The company must ramp 14A on schedule while competing against TSMC’s 2nm technology, due in 2025. Delays could erode the confidence that today’s capex hike implies.
