Intel Corporation (INTC Quick QuoteINTC - Free Report) is scheduled to report third-quarter 2026 earnings after the closing bell on Oct. 29. In the to-be-reported quarter, the company is likely to have recorded higher revenues from the Datacenter and AI Group (DCAI) segment, owing to the expansion of its AI infrastructure portfolio with three new platforms designed to support agentic AI across data centers, enterprise systems and intelligent edge devices.

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 introduced Diamond Rapids, Crescent Island and Wildcat Lake to address growing AI demands across data centers and intelligent devices. Intel’s next-generation Diamond Rapids Xeon processor is designed to support enterprise-scale agentic AI workloads. The Crescent Island is a low-power AI inference GPU based on the Xe3P architecture, featuring 32 Xe cores, 256 XMX engines and up to 480GB of LPDDR5X memory in a 350-watt air-cooled PCIe design. At the edge, the company launched Wildcat Lake as Intel Core Series 3 processors, bringing AI capabilities to laptops and edge devices with two performance cores, four efficiency cores, Xe3 graphics with XMX acceleration and an NPU offering up to 17 TOPS, along with support for LPDDR5X-7467, Wi-Fi 7 and Bluetooth 6.0. These offerings highlight Intel’s strategy for addressing AI requirements across infrastructure and devices for a more competitive AI hardware ecosystem.

As demand for AI inference grows, Intel is combining optimized hardware and software to deliver scalable, efficient and cost-effective solutions for increasingly complex AI workloads. The company improved its AI inference capabilities with the latest MLPerf Inference v6.1 results, showing performance gains across Intel Xeon 6 processors and Intel Arc Pro B-series GPUs. The results highlight the company’s continued efforts to optimize AI frameworks, kernels and serving software for more efficient inference. Intel Xeon 6980P processors delivered 2.4x higher Llama 3.1 8B Server throughput and 56% higher Offline throughput than MLPerf v6.0 using the same hardware setup, reflecting the benefits of software optimization.

The increased adoption of Intel processors and NPUs follows the positive feedback of Xeon 6 processors with Performance-cores (P-Cores). This system-on-chip (SoC) has been designed to meet the huge demand for high AI workloads across various sectors. With industry-leading performance across data center workloads and up to two times higher performance in AI processing, the Xeon 6 family delivers the industry’s best central processing unit (CPU) for AI at a lower total cost of ownership (TCO).
 
Intel Xeon platforms have reportedly set the benchmark in 5G cloud-native core with substantial performance and power-efficiency improvements, additional power-saving capabilities and easy-to-deploy software. This has driven healthy demand trends from major telecom equipment manufacturers and independent software vendors to optimize and unleash proven power savings for a more sustainable future. These are likely to have generated incremental revenues in the quarter.

However, China's purported move to replace U.S.-made chips with domestic alternatives is expected to affect the segment’s revenues as Intel derives a significant portion of its revenues from the Asian country. The recent directive to phase out foreign chips from key telecom networks by 2027 underscores Beijing's accelerating efforts to reduce reliance on Western technology amid escalating U.S.-China tensions and tariff wars.

As Washington tightens restrictions on high-tech exports to China, Beijing has intensified its push for self-sufficiency in critical industries. This shift poses a dual challenge for Intel, as it faces potential market restrictions and increased competition from domestic chipmakers. In addition, Intel is witnessing intensifying competition in the server, storage and networking markets from its rivals.

Overall Expectations

The Zacks Consensus Estimate for Data Center and AI revenues is pegged at $6.46 billion, indicating a rise from $4.12 billion in the year-ago quarter. 

For the September quarter, the Zacks Consensus Estimate for total revenues is pegged at $16.44 billion, which indicates an increase from the year-ago quarter’s reported figure of $13.65 billion. The consensus estimate for earnings of 39 cents per share suggests an improvement from 23 cents reported in the prior year.

Earnings Whispers

Our proven model predicts an earnings beat for Intel for the third 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 are reported with our Earnings ESP Filter. 

Intel currently has an ESP of +2.22% with a Zacks Rank #1. 

You can see the complete list of today’s Zacks #1 Rank stocks here.

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:

Monolithic Power Systems, Inc. (MPWR Quick QuoteMPWR - Free Report) is set to release quarterly numbers on Oct. 29. It has an Earnings ESP of +1.35% and carries a Zacks Rank #2. 

The Earnings ESP for InterDigital, Inc. (IDCC Quick QuoteIDCC - Free Report) is +0.77% and it carries a Zacks Rank of 3. The company is scheduled to report quarterly numbers on Oct. 29.

The Earnings ESP for Advanced Micro Devices, Inc. (AMD Quick QuoteAMD - Free Report) is +2.55% and it carries a Zacks Rank of 3. The company is scheduled to report quarterly numbers on Nov. 3.