TLDR
Intel stock plunges 16.82% after hours despite 78% growth in data center and AI revenue.
Intel posts $16.5 billion in Q3 revenue, but shares slide sharply after earnings.
Intel data center revenue jumps 78% as PC weakness weighs on its stock outlook.
Intel Foundry revenue surges 58%, while GAAP earnings fall 18% in the third quarter.
Intel stock drops to $76.58 after hours despite stronger revenue and profit margins.
Intel (INTC) stock dropped 3.62% to $92.07 at market close before plunging 16.82% to $76.58 in after-hours trading. The sharp decline followed the company’s third-quarter 2026 earnings report, which showed stronger revenue and substantial growth in data center operations. However, weakening PC demand and lower GAAP earnings added pressure despite improvements across several business segments.
Intel Corp., INTC
Intel Stock Falls After Third-Quarter Earnings Report
Intel reported third-quarter revenue of $16.5 billion, representing a 21% increase from $13.7 billion a year earlier. Meanwhile, the company generated $5.1 billion in cash from operations, reflecting its financial performance during the quarter. Despite higher revenue and improved operating margins, the stock suffered a sharp after-hours decline following the results.
Intel recorded GAAP net income attributable to the company of $3.3 billion, down 18% from $4.1 billion in the previous year. Diluted GAAP earnings per share fell 33% to $0.60 from $0.90 during the same period. However, non-GAAP net income increased 169% to $2.8 billion, while non-GAAP diluted earnings per share climbed 126% to $0.52.
The company’s GAAP gross margin reached 43.0%, compared with 38.2% a year earlier, marking an improvement of 4.8 percentage points. Additionally, its non-GAAP gross margin rose to 44.1% from 40.0%, while non-GAAP operating margin increased to 19.6%. These improvements indicated stronger operating performance, although the decline in GAAP earnings presented a different picture.
Data Center and AI Revenue Jumps 78%
Intel’s Data Center and AI division generated $7.3 billion in third-quarter revenue, marking a 78% increase from the previous year. The segment delivered one of the company’s strongest growth contributions as demand for computing capacity expanded across data center operations. The division became a major contributor to Intel’s overall revenue growth during the quarter.
Total Intel Products revenue reached $15.4 billion, representing a 22% increase compared with the third quarter of 2025. The Client Computing and Physical AI Group generated $8.1 billion, down 5% year over year. This contrast highlighted the growing importance of data center products as Intel faced weaker conditions in its traditional PC business.
Intel Foundry reported $6.7 billion in revenue, an increase of 58% from the previous year. Revenue from the All Other category declined 30% to $0.7 billion, and intersegment eliminations reduced reported consolidated revenue. After these adjustments, Intel recorded total net revenue of $16.5 billion for the quarter.
PC Slowdown Adds Pressure to Intel’s Outlook
Intel identified weaker PC market conditions as a continuing challenge, with the slowdown expected to persist through at least the first half of 2027. The company also highlighted strong demand for its Xeon processors and the need to increase supply. Therefore, production capacity and product availability remain important factors in its ability to meet customer demand.
Chief Executive Officer Lip-Bu Tan emphasized execution, manufacturing capacity and process technology as priorities for the business. Chief Financial Officer David Zinsner also highlighted the quarter’s revenue, gross margin and earnings performance against company guidance. Management’s outlook pointed to continued PC weakness alongside opportunities across Intel’s broader product portfolio.
Intel’s latest results revealed a clear divide between accelerating data center revenue and declining PC-related sales. Although total revenue increased 21% and Intel Foundry expanded 58%, GAAP net income and diluted earnings per share declined year over year. The subsequent after-hours sell-off showed that strong segment growth did not prevent a sharp negative stock reaction following the earnings announcement.
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