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Can Solid DCAI Segment Revenues Boost Intel's Q2 Earnings?
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Key Takeaways
Intel's DCAI business may benefit from stronger Xeon demand and AI infrastructure investment.
INTC expanded its Google collaboration to advance AI infrastructure and cloud data center innovation.
Intel introduced Xeon 6 processors with up to 288 efficient cores for AI and cloud workloads.
Intel Corporation (INTC - Free Report) is scheduled to report second-quarter 2026 earnings after the closing bell on July 23. In the to-be-reported quarter, the company is likely to have recorded higher revenues from the Datacenter and AI Group (DCAI) segment backed by strong Xeon server CPU demand, growing AI infrastructure investment and long-term hyperscaler agreements.
Factors at Play
The DCAI segment seeks to develop leading data center products, including Intel Xeon servers and field programmable gate array products, while overseeing the overall AI strategy.
During the quarter, Intel expanded its collaboration with Google to advance AI infrastructure, aiming to improve computing performance, accelerate AI workloads, and develop more efficient hardware-software integration to support next-generation artificial intelligence applications and large-scale cloud innovation across global data centers.
In the quarter under review, the company recently introduced Xeon 6+ processors built on Intel 18A. The chip, optimized for agentic AI infrastructure, brings key capabilities, such as up to 288 efficient cores and up to 2.5X performance improvement versus the prior generation. It is designed to support high concurrency, data movement, AI orchestration, Telecom workloads and cloud-native infrastructure.
In the Bellflower Connect smart city pilot, Tradewinds Networks leveraged Intel Xeon-powered edge infrastructure and AI-driven cybersecurity to deliver affordable broadband connectivity. Collaboration with major tech giants, strong focus on innovation and customer wins are expected to have a favorable impact in this segment.
Overall Expectations
The Zacks Consensus Estimate for DCAI revenues is pegged at $5.47 billion, indicating an improvement from $3.93 billion in the year-ago quarter.
For the September quarter, the Zacks Consensus Estimate for total revenues is pegged at $13.43 billion, which indicates a increase from the year-ago quarter’s reported figure of $11.81 billion.The consensus estimate for EPS is pegged at 21 cents per share, indicating an increase from a loss of 10 cents per share year ago.
Earnings Whispers
Our proven model predicts a likely earnings beat for Intel for the second quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is perfectly the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Intel currently has an ESP of +5.18% with a Zacks Rank #1.
Here are some other companies you may want to consider, as our model shows that these, too, have the right combination of elements to post an earnings beat this season:
Silicon Motion Technology Corporation (SIMO - Free Report) has an Earnings ESP of +7.68% and sports a Zacks Rank #1 at present. It is set to release its second-quarter 2026 numbers on July 29.
The Earnings ESP for Celestica Inc. (CLS - Free Report) is +1.86%, and it carries a Zacks Rank of 2 at present. The company is scheduled to report second-quarter 2026 numbers on July 27.
The Earnings ESP for Monolithic Power Systems, Inc. (MPWR - Free Report) is +1.08%, and it carries a Zacks Rank of 2 at present. The company is slated to report second-quarter 2026 numbers on July 30.
View the Zacks #1 Rank List
Image: Bigstock
Can Solid DCAI Segment Revenues Boost Intel's Q2 Earnings?
Key Takeaways
Intel Corporation (INTC - Free Report) is scheduled to report second-quarter 2026 earnings after the closing bell on July 23. In the to-be-reported quarter, the company is likely to have recorded higher revenues from the Datacenter and AI Group (DCAI) segment backed by strong Xeon server CPU demand, growing AI infrastructure investment and long-term hyperscaler agreements.
Factors at Play
The DCAI segment seeks to develop leading data center products, including Intel Xeon servers and field programmable gate array products, while overseeing the overall AI strategy.
During the quarter, Intel expanded its collaboration with Google to advance AI infrastructure, aiming to improve computing performance, accelerate AI workloads, and develop more efficient hardware-software integration to support next-generation artificial intelligence applications and large-scale cloud innovation across global data centers.
In the quarter under review, the company recently introduced Xeon 6+ processors built on Intel 18A. The chip, optimized for agentic AI infrastructure, brings key capabilities, such as up to 288 efficient cores and up to 2.5X performance improvement versus the prior generation. It is designed to support high concurrency, data movement, AI orchestration, Telecom workloads and cloud-native infrastructure.
In the Bellflower Connect smart city pilot, Tradewinds Networks leveraged Intel Xeon-powered edge infrastructure and AI-driven cybersecurity to deliver affordable broadband connectivity. Collaboration with major tech giants, strong focus on innovation and customer wins are expected to have a favorable impact in this segment.
Overall Expectations
The Zacks Consensus Estimate for DCAI revenues is pegged at $5.47 billion, indicating an improvement from $3.93 billion in the year-ago quarter.
For the September quarter, the Zacks Consensus Estimate for total revenues is pegged at $13.43 billion, which indicates a increase from the year-ago quarter’s reported figure of $11.81 billion.The consensus estimate for EPS is pegged at 21 cents per share, indicating an increase from a loss of 10 cents per share year ago.
Earnings Whispers
Our proven model predicts a likely earnings beat for Intel for the second quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is perfectly the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Intel currently has an ESP of +5.18% with a Zacks Rank #1.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Intel Corporation Price and EPS Surprise
Intel Corporation price-eps-surprise | Intel Corporation Quote
Other Stocks to Consider
Here are some other companies you may want to consider, as our model shows that these, too, have the right combination of elements to post an earnings beat this season:
Silicon Motion Technology Corporation (SIMO - Free Report) has an Earnings ESP of +7.68% and sports a Zacks Rank #1 at present. It is set to release its second-quarter 2026 numbers on July 29.
The Earnings ESP for Celestica Inc. (CLS - Free Report) is +1.86%, and it carries a Zacks Rank of 2 at present. The company is scheduled to report second-quarter 2026 numbers on July 27.
The Earnings ESP for Monolithic Power Systems, Inc. (MPWR - Free Report) is +1.08%, and it carries a Zacks Rank of 2 at present. The company is slated to report second-quarter 2026 numbers on July 30.