The renewed confidence follows a bruising 2024, when Intel’s shares tumbled after years of strategic missteps, including a flawed artificial intelligence roadmap that left the company trailing rivals and led to thousands of job cuts. Since then, Tan has sought to reset the company’s direction, drawing fresh investor interest through a series of high-profile investments and operational changes.
Intel’s stock rose 84% in 2025, sharply outperforming the benchmark semiconductor index, which gained about 42%. The company is scheduled to report earnings after markets close on Thursday, a moment widely seen as an early test of whether the recovery narrative is supported by results.
A strengthened balance sheet has been central to the shift in sentiment. Intel secured $5 billion in investment from Nvidia, $2 billion from SoftBank, and additional backing from the U.S. government, giving Tan greater flexibility to rework the company’s manufacturing strategy and reposition its AI ambitions.
Tan has also moved to streamline Intel’s operations, revamping its chipmaking unit and reducing what he described as an overly complex management structure.
“It’s the most optimistic people have felt about the company in a long time,” said Ryuta Makino, an analyst at Gabelli Funds, an Intel investor. “The near-term dynamics are set up very well. The core bull case is that we could see at least a double-digit increase in server CPU pricing in 2026.”
Reflecting the improving outlook, at least 10 brokerages have raised their price targets or upgraded their ratings on Intel in the past two months.
Analysts expect Intel’s data center unit to be a key driver of its quarterly performance. According to LSEG data, revenue from the segment is forecast to jump more than 30% to $4.43 billion in the quarter ended December. The growth is attributed to large technology companies building advanced data centers that still rely heavily on Intel’s traditional server chips and CPUs, even as they deploy graphics processors from Nvidia and other specialists.
Intel’s personal computer division is also expected to show modest improvement, with sales projected to rise about 2.5% to $8.21 billion.
Despite the improving tone, challenges remain. Intel has steadily lost market share in PCs to rival AMD and to Arm-based chip designs, and analysts warn that PC demand could soften further. A global shortage of memory chips has pushed up prices, making laptops more expensive and potentially weighing on sales.
UBS analysts said earlier this month that while data center demand remains strong, higher memory costs could curb PC growth, noting that memory accounts for roughly 25% to 30% of a PC’s bill of materials. The firm now expects global PC shipments to fall about 4% in 2026, compared with a prior forecast of more than 3% growth.
Intel is hoping its refreshed product lineup can help stem some of those losses. The company has begun shipping its new “Panther Lake” PC chips, the first products manufactured using its closely watched 18A process technology. Previous-generation PC chips were largely produced by Taiwan Semiconductor Manufacturing Co., marking a departure from Intel’s long-standing practice of relying on its own factories.
With growing political support in the United States, investors are also watching closely to see whether Intel can attract external customers to its foundry business.
“We really like Lip-Bu Tan, but more importantly, powerful figures across the industry and government like him even more as a business partner,” Melius Research analysts wrote in a recent note, citing support from senior U.S. officials and rival chip executives.
Still, uncertainty surrounds Intel’s manufacturing progress. Reuters has reported that Nvidia and Broadcom have conducted manufacturing tests with Intel, but only a small proportion of chips produced using the 18A process have so far met customer standards. Intel has said yields are improving month by month, though pressure from low yields is expected to weigh on profitability.
Analysts forecast Intel’s adjusted gross margin fell by roughly six percentage points to about 36.5% in the December quarter, underscoring that while investor confidence has rebounded, the company’s turnaround remains a work in progress.