Demand for Intel’s server chips now exceeds its production capacity, according to Chief Financial Officer David Zinsner. In the third quarter of 2026, the Data Center and AI division generated $7.3 billion in revenue, up 78% year over year and growing at its fastest rate in 15 years. This performance, driven notably by Xeon processors and demand for inference and agentic AI, could allow the segment to beat forecasts by nearly $10 billion by the end of the year. Intel nevertheless forecasts fourth-quarter revenue of $15 billion to $16 billion, below consensus, because of weakness in the PC market and disruption caused by an explosion at its Kiryat Gat factory in Israel. To close the supply gap, the company raised its 2026 capital expenditure to $20 billion and signed several long-term supply agreements with major cloud operators and enterprises.
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