Earnings

Intel (INTC) Q4 2025 Earnings — Core Brief Edition

Core-Brief

08 Feb 2026 — 3 min read

Headline: Intel beat Q4 guidance on revenue, gross margin, and EPS, but flagged a Q1’26 supply trough as buffer inventory is depleted; AI-led demand remains strong across client, server, networking, and custom ASIC.

Key Metrics

Revenue: $13.7B (high end of guide).
Non-GAAP gross margin: 37.9% (+140 bps vs. guide).
Non-GAAP EPS: $0.15 (vs. guide $0.08).
Operating cash flow (Q4): $4.3B.
Growth capex (Q4): $4.0B.
Adjusted free cash flow (Q4): $2.2B.
FY2025 revenue: $52.9B (down slightly YoY).
FY2025 non-GAAP gross margin: 36.7% (+70 bps YoY).
FY2025 non-GAAP EPS: $0.42 (up YoY per management commentary).
FY2025 non-GAAP opex: $16.5B (-15% vs. 2024).
Cash & short-term investments (end of 2025): $37.4B.
Debt repaid (2025): $3.7B.
Q1’26 guidance (non-GAAP):
- Revenue: $11.7B–$12.7B (midpoint $12.2B)
- Gross margin: ~34.5%
- Tax rate: ~11%
- EPS: ~$0.00 (breakeven)

Segment & Strategy Highlights

Intel Products (Q4 revenue): $12.9B (+2% QoQ)
- CCG (Client): $8.2B (revenue -4% QoQ; AI PC units +16%)
- DCAI: $4.7B (+15% QoQ, “fastest sequential growth this decade”; would’ve been higher without supply limits)
- Intel Products op profit: $3.5B (27% margin), down QoQ on more outsourced mix + seasonally higher opex
Intel Foundry (Q4 revenue): $4.5B (+6.4% QoQ)
- External foundry revenue: $222M (US gov’t projects + Altera deconsolidation impacts)
- Foundry op loss: $2.5B (worse QoQ, driven by early 18A ramp)
- EUV wafer revenue mix: from <1% of wafers (2023) to >10% (2025)
All Other (Q4 revenue): $574M (sequentially down; impacted by Altera deconsolidation)
- Operating loss: $8M

Product, Tech, AI / Accelerators

Client: Core Ultra Series 3 (“Panther Lake”) launched; Intel says it shipped 3 SKUs by end of 2025 (ahead of earlier plan). OEM momentum: 200+ notebook designs; performance claims included up to 27 hours battery, +70% gen-on-gen graphics improvement, and benchmark gains vs peers.
Hybrid AI thesis: Intel highlighted “cloud capacity alone cannot meet scale” in a power-constrained world, pushing more workloads toward hybrid AI (cloud + client).
Data Center / AI: Intel centralized DCAI under one leader to align CPUs/GPUs/platform strategy; reiterated demand strength in traditional servers, and emphasized CPUs’ coordinating role as AI shifts toward persistent/recursive, computer-to-computer traffic.
Custom ASIC: Business grew >50% in 2025, +26% QoQ, reaching >$1B annualized run-rate in Q4; framed as a pathway into a $100B TAM.
NVIDIA partnership: Working on a custom Xeon integrated with NVLink for AI host nodes; also noted NVIDIA’s $5B investment closed in Q4.

Foundry & Packaging

18A: Intel said it is shipping first products built on Intel 18A (manufactured in the US) and continues improving yields as it ramps supply.
14A: Development “on track”; customer engagements described as active, with firm supplier decisions expected starting 2H’26 into 1H’27; Intel intends to hold back capacity capex on 14A until customer volume commitments are secured.
Advanced packaging (EMIB / Foveros / “EMIT-T” referenced): Management flagged packaging as an earlier revenue indicator than wafer volume; commentary suggested early opportunities could be “well north of $1B” per engagement (qualitative, no formal guidance).

Supply, Mix, and Margin Watch

Supply constraints materially limited Q4 upside and are expected to be most acute in Q1’26 as buffer inventory is depleted and wafer mix shift toward servers “won’t come out of fab until late Q1’26.”
Intel is prioritizing internal wafer supply to data center, using more external wafers for client.
Q1 gross margin pressure: lower revenue (fixed-cost leverage) + Panther Lake still dilutive to corporate GM due to early ramp costs and higher mix share.
Management’s near-term margin goal: move from ~34.5% toward 40% (then “set a new target”).

Balance Sheet & Capital

Intel exited 2025 with $37.4B cash/short-term investments, helped by monetizations and strategic investments (SoftBank group mentioned, plus NVIDIA).
2026 capex: now planned flat to slightly down (vs. prior “down”), weighted to 1H; spending down significantly in “space” (cleanroom/real estate) but up on tools to increase wafer starts on Intel 7 / Intel 3 / 18A.
2026 adjusted FCF: expects positive for full year; plans to retire $2.5B maturities due in 2026.
Share count: ~5.1B shares in Q1’26, expected to rise with SBC.

Guidance / Outlook

Q1’26 (non-GAAP): revenue $11.7B–$12.7B (mid $12.2B), GM ~34.5%, EPS ~$0.00.
Management expects supply improves starting Q2 and continues improving each quarter in 2026; suggested results could be better than seasonal if supply ramps as planned.
Risks highlighted: industry constraints and rising prices in DRAM/NAND/substrates could limit client upside and pressure economics.

Bottom Line

Intel is framing 2025 as a “new Intel” reset: tighter execution, lower opex, and a clearer platform strategy into the AI buildout. Near-term, the story hinges on getting out of the Q1 supply trough, improving 18A yields/cost, and converting foundry engagement into committed 14A volume—with advanced packaging positioned as a nearer-term revenue catalyst.