New Delhi, India, October 23, 2025 – Intel Corp. exceeded Wall Street’s profit expectations for Q3 2025. This signals a potential turnaround for the struggling semiconductor giant. Shares jumped 7% in after-hours trading following the earnings announcement, reflecting renewed investor confidence in the company’s restructuring and strategic investment initiatives.
Under CEO Lip-Bu Tan, Intel implemented a comprehensive operational overhaul after a challenging 2024. That year, the company reported its first annual loss in nearly four decades. Measures included divestments, workforce reductions exceeding 20%, and scaling back manufacturing ambitions set by former CEO Pat Gelsinger. These cost-cutting efforts improved operational efficiency and gross margins. They also helped restore confidence in Intel’s long-term strategy.
Substantial external investments fueled the company’s financial rebound this quarter. Japan’s SoftBank invested $2 billion, while Nvidia committed $5 billion. This will translate to a 4% equity stake following new share issuance. Additionally, the U.S. government acquired a 10% stake in Intel for $8.9 billion, reflecting the strategic importance of domestic semiconductor production. While Nvidia’s investment is pending, CFO Dave Zinsner confirmed that SoftBank’s funds have already been received. These funds bolster Intel’s balance sheet and enable further expansion into high-demand segments.
Intel remains under pressure in a competitive CPU market. The company faces strong rivals such as Advanced Micro Devices (AMD) and continues to strive for relevance in the AI chip sector dominated by Nvidia. Nonetheless, the company’s stock has rebounded sharply in 2025, climbing nearly 90% and outperforming Nvidia shares. Analysts attribute this surge to improved financial guidance, visible cost efficiencies, strategic funding, and growing demand for AI-powered PCs. Michael Schulman, Chief Investment Officer at Running Point Capital, noted: “Shares rose after better-than-expected guidance, visible gross margin progress, AI-PC momentum, and $15 billion in strategic funding that strengthens the balance sheet.”
Intel’s strategic restructuring extends beyond cost-cutting. The company recently sold a 51% stake in Altera, the programmable chip designer acquired in 2015, to Silver Lake. This marks a shift toward a leaner, more focused business model. CEO Tan also announced the creation of a central engineering group. It is dedicated to proprietary chip designs and custom solutions for external clients. This initiative positions Intel to compete with Broadcom and Marvell Technologies, which supply AI chips to major tech players such as Google and Amazon.
Demand for Intel chips has surged, particularly in data centers upgrading CPUs to support advanced AI applications. Zinsner remarked: “We are under-shipping relative to demand. This is a high-class problem, reflecting strong market traction and growing interest in AI-enabled computing.”
Despite these gains, Intel faces ongoing challenges. Its 18A manufacturing process, a critical component of next-generation chip production, has yet to achieve yields necessary for optimal profitability. Industry-standard yields are not expected until 2027, indicating that technical and production hurdles remain.
Intel reported adjusted gross margins of 40% in Q3, surpassing analysts’ expectations of 35.7%. Adjusted earnings came in at 23 cents per share, significantly higher than the projected 1 cent. For Q4, the company projects revenue between $12.8 billion and $13.8 billion, slightly below market consensus. Capital expenditures are expected to rise to $27 billion in 2025, up from $17 billion in 2024. This reflects continued investments in advanced manufacturing and research capabilities.
The company’s leadership emphasized that cost discipline, strategic funding, and technological investment are central to Intel’s roadmap for sustained growth. By focusing on AI-driven PCs, data center upgrades, and custom chip development, Intel aims to reclaim competitiveness in both traditional and emerging semiconductor markets.
Intel’s third-quarter performance underscores its potential for recovery in a dynamic industry. The company is strategically balancing operational efficiency with targeted investments. This ensures it can navigate competitive pressures while preparing for long-term growth. With strong demand, strategic capital infusions, and a focus on innovation, Intel is positioning itself to regain prominence in the global semiconductor landscape.
