Intel's comeback: Finally managed to catch the AI trend
A year after Lip-Bu Tan took over as Intel CEO, the company is showing strong growth. Second-quarter 2026 revenue jumped 25% to $16.1 billion, marking the company's strongest quarterly performance in 15 years.
When Lip-Bu Tan took over as CEO of Intel in March 2025, he inherited a broken, struggling company that had missed the mobile revolution. Nvidia had successfully ridden the wave of the AI revolution, leaving Intel behind. The revival efforts of the previous CEO, Pat Gelsinger, to position the company as a chip manufacturer for other firms were perceived as a costly failure, leading to his departure. Many wondered if even a person as multi-talented as Tan could halt Intel's decline. A year and a quarter later, with the publication of Intel's report for the second quarter of 2026, it is clear that Tan has achieved a significant turnaround. The decline has not only stopped, but Intel has changed course and is accelerating its growth. While Tan deserves much of the credit, this success is also the result of moves initiated before his tenure and market conditions that have become more aligned with the company's core strengths.
"The fastest pace in our history"
Intel's revenue in the second quarter jumped by 25% to $16.1 billion, the strongest quarterly growth in the last 15 years. On a GAAP basis, the company recorded a loss of $11 billion (compared to $2.9 billion last year), though this figure is primarily due to a $12.5 billion accounting loss from the revaluation of shares held in trust. Excluding this, Intel recorded a Non-GAAP net profit of $2.2 billion (compared to a $400 million loss in the second quarter of 2025).
The company's strongest growth was recorded in its data center and AI group, where sales jumped 59% to $6.3 billion. This group competes directly with Nvidia. Intel has yet to present a graphics processing unit (GPU) that can challenge Nvidia's dominance in AI model training. However, the market has shifted: as AI agents see wider adoption, demand for computing power to run these models has surged. Central processing units (CPUs) are highly efficient for this task, and Intel's Xeon series for data centers remains a top-tier product. "The growth in the second quarter was the strongest in history, and Xeon 6 continues to be one of the fastest-growing products in Intel's history," Tan told analysts. The company's top priority is now increasing production capacity to meet this demand, which is currently constrained by industry-wide shortages of memory and chip substrates. Another growth driver was the foundry business, which grew by 31% to $5.8 billion, building on foundations laid by Gelsinger.
From crisis to the White House
Tan is not only executing a long-term vision but has also made astute tactical moves. In August 2025, he faced pressure from Donald Trump, who called for his resignation citing a "serious conflict of interest" regarding past ties to China. However, during a meeting at the White House, Tan successfully won over the President, who later called him an "incredible success." It was soon revealed that Tan had convinced Trump to convert a $10.5 billion government grant for US chip factories into an equity investment, with the administration purchasing 10% of Intel's shares. Strategically, this made the White House a stakeholder in Intel's success. Tan continues to drive deep cultural changes, ensuring the organization operates with greater efficiency and has fully adopted an "AI-first" mentality.
