Intel reported first-quarter revenue of $12.72 billion Thursday, up 2.1% year over year and roughly in line with the $12.6 billion consensus. Adjusted earnings per share printed at $0.12 against a $0.06 consensus, a beat delivered primarily through cost-reduction credit rather than operational leverage. [1] This is the first full quarter under CEO Lip-Bu Tan, who took the role in March after the board's decision to separate the product and foundry narratives by leadership structure rather than by corporate structure.

Client Computing Group — the PC chip business — posted $7.6 billion in revenue, up 3% year over year. Data Center and AI was $4.3 billion, up 8%. Intel Foundry posted $4.2 billion of internal-plus-external revenue with an operating loss of $2.3 billion, essentially unchanged from the run rate Pat Gelsinger's final quarters produced. [1] The operating loss is the company's acknowledgement that the foundry thesis — that outside customers will pay to use Intel's advanced process nodes — remains unproven at scale.

What Tan did not announce on the call: a named foundry customer on the 18A process node. Intel confirmed the process is shipping for internal products (Panther Lake) and that multiple external design wins are "in late-stage validation." [2] Late-stage validation is not a signed wafer agreement. The customer list — the real test of the foundry strategy — is still private. Every quarter that passes without a named hyperscaler or fabless anchor customer narrows the timeframe in which 18A economics can become competitive with TSMC's N2.

Guidance for Q2 is revenue of $12.5 billion to $13.5 billion with EPS of $0.00 to $0.10. [1] The zero floor reflects a planned restructuring charge related to the European fab slowdown and the 2025 workforce reduction's trailing costs. Full-year guidance was not reissued; Tan said on the call that the company would return to full-year guidance in Q2, which means he is not yet comfortable forecasting the foundry loss envelope across the full year.

The stock traded up 2.8% in the aftermarket on the EPS beat. That is a relief rally, not a re-rating. Analyst notes from the call will likely focus on two things: the gross-margin trajectory (55.7% this quarter, guided 54-56% for Q2, versus mid-60s historical) and the foundry customer question. Neither resolves on this print.

The competitive backdrop has not softened. TSMC's own Q1 print last week confirmed N2 is on schedule for H2 2026 volume with Apple, AMD, and Nvidia design wins secured. [3] Intel's 18A has a narrow window in which it can recruit secondary customers before N2 absorbs the available capacity. Tan has perhaps two quarters to convert "late-stage validation" into announced agreements. Thursday he did not. Q2 will be the more consequential print.

-- THEO KAPLAN, San Francisco