Intel and AMD Earnings Preview: Signs of Data Center Recovery Emerge, While Concerns Remain in PC Market

The strong recovery in server CPU demand is providing crucial support for Intel and AMD, but the ongoing weakness in the PC market represents a significant downside risk. The upcoming quarterly earnings of both companies will be put to the test amid this divergent landscape.

According to a report by Bernstein Research released on July 21, analyst Stacy A. Rasgon maintains an "in-line" rating on Intel with a $100 price target and an "outperform" rating on AMD with a $600 price target, as reported by Chaser Trading Desk News.

The report points out that strong momentum in the data center business is expected to partially offset the drag from the client business. However, both companies’ full-year forecasts are below market consensus, with the main divergence centered on assumptions for PC demand.

Intel's stock price has risen 163% year-to-date, significantly outperforming the broader market and the Philadelphia Semiconductor Index; AMD has gained 135% over the same period, but both have pulled back noticeably from recent highs.

Bernstein believes that the cyclical recovery in server CPU demand, combined with upward revisions from agentic AI-driven demand, are the core drivers of strong share performance for both companies, while memory pricing pressure in the PC market remains the most significant current uncertainty.

Intel: Server Narrative Lifts Sentiment, PC and Foundry Remain Variables

Intel is scheduled to report its Q2 2026 earnings on Thursday, July 23 at 5:00 p.m. ET.

Bernstein projects Intel’s Q2 revenue at $14.3 billion and non-GAAP EPS at $0.20, slightly below Bloomberg consensus of $14.4 billion and $0.21 USD. Full-year 2026 estimates are $57.6 billion/$1.07 per share, below consensus of $58.6 billion/$1.11; 2027 estimates are $63.3 billion/$1.50, also below consensus of $66.0 billion/$1.57 per share.

The report notes that Intel currently benefits from extremely strong server demand—a cyclical rebound after several years of post-pandemic pent-up demand, coupled with surging requirements from agentic AI. Notably, even though Intel’s current server product competitiveness is relatively weak, the company can still sell inventory previously considered obsolete, as customers are willing to buy anything available. Meanwhile, market discussion around Intel Foundry Services (IFS) is heating up, involving rumors of potential cooperation with Apple and AI packaging business—particularly with some credibility in the packaging space.

However, the outlook for the PC business remains worrying.

IDC and Gartner data show that global PC shipments fell 5% and 4% year-on-year in Q2 2026, a marked slowdown from mid-single-digit growth in Q1 and essentially flat sequentially (IDC: +0.4%, Gartner: -0.9%), roughly matching seasonal pre-pandemic patterns but weaker compared to recent years. Notebook shipments from Taiwan ODMs dropped 4% year-on-year in April and 12% in May, with dynamics in the memory market expected to further dampen PC demand in the second half of the year.

Bernstein indicates that the robust performance in servers and the strengthening foundry narrative could offset some risks, but this may be accompanied by higher capital expenditures, thereby putting pressure on free cash flow and margins. The report states that analyst sentiment on Intel is "more optimistic than at any time in a while," though fundamentals (market share trends, PC outlook, etc.) as a whole still face challenges.

AMD: AI GPU Potential Underestimated, 2027 Outlook May Still Be Too Low

AMD is set to report its Q2 results on Tuesday, August 4, and will host its 2026 "Advancing AI" conference in San Francisco from July 22-23. CEO Dr. Lisa Su will deliver a keynote speech at 9:30 a.m. PT on July 23.

Bernstein forecasts AMD Q2 revenue at $11.2 billion and non-GAAP EPS at $1.60, slightly below consensus estimates of $11.3 billion and $1.62 per share. Q3 projections are $11.7 billion/$1.65 per share, significantly under consensus estimates of $12.4 billion/$1.84 per share, mainly due to weaker PC demand assumptions and MI450 GPU ramping primarily modeled for Q4. Full-year 2026 projections are $47.9 billion/$6.98 per share, below consensus of $50.0 billion/$7.30 per share.

However, Bernstein’s forecast for AMD in 2027 is higher than the market: projecting revenue of $82.2 billion/$14.61 per share, above consensus of $77.7 billion/$13.35 per share. The report believes that Bloomberg consensus is significantly underestimating AMD’s 2027 AI GPU revenue (projecting around $33.5 billion), while Bernstein itself estimates about $43 billion, assuming clients such as OpenAI and Meta achieve scale shipments by then.

The report points out that AMD’s gains in the server CPU market even surpass Intel, as its products demonstrate genuine market competitiveness and continue to win share. For AI GPUs, the mass production ramp of MI450 (Q3 or Q4?) is a key variable to watch in the near term. Bernstein believes that as server CPUs and AI GPUs advance in parallel, AMD is likely to reach its 2030 target of over $20 EPS years ahead of schedule—the firm projects AMD could approach this level as soon as 2028.

The upcoming "Advancing AI" conference is seen as a potential catalyst and could bring new customer announcements, product roadmap details, and updates on addressable market (TAM). The report also mentions AMD’s recent partnership with Microsoft and notes that although AMD’s share price has pulled back noticeably from recent highs, Bernstein believes there are investment opportunities at current levels.

PC Market: Memory Pressure Looms Over H2 Prospects

Weakness in the PC market is a common thread running through both companies’ forward-looking reports and the primary reason why Bernstein’s forecasts are below the consensus.

IDC and Gartner data show that PC shipments in Q2 dropped by 4% to 5% year-on-year, a significant slowdown from mid-single-digit growth in Q1. Taiwan ODM notebook shipments fell a combined 8% year-on-year in April and May, plunging 34% month-on-month in April before a modest 2% rebound in May.

Bernstein believes that trends in the memory market will further suppress PC shipments in the second half of the year. The state of channel inventories and whether CPU distribution channels have normalized will be important topics on both companies’ earnings calls. For Intel, PC business weakness is compounded by declining notebook CPU share; for AMD, PC client risks are likewise the main factor dragging full-year 2026 forecasts below the consensus.

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