To The Moon

but Its $11 Billion GAAP Loss Still Matters

$Intel(INTC)$’s second-quarter report provided its strongest evidence yet that the turnaround is gaining commercial momentum. Revenue and adjusted earnings substantially exceeded expectations, while management issued an unusually strong third-quarter forecast. However, the difference between Intel’s adjusted performance and GAAP results shows that the recovery remains expensive.

Revenue increased 25% year over year to $16.13 billion, compared with approximately $14.4 billion expected by analysts. Adjusted earnings reached $0.42 per share, double the consensus estimate. Intel forecast third-quarter revenue of $15.8 billion–$16.8 billion and adjusted earnings of $0.38 per share, also above expectations. Reuters’ July 23 earnings report details the results and guidance.

The Data Center and AI segment generated approximately $6.26 billion of revenue as demand for server processors accelerated. This matters because AI infrastructure requires more than GPUs: data centres also need CPUs for data preparation, orchestration, networking and general computing. Increasing agentic-AI workloads could expand that supporting market.

Intel Foundry revenue rose to approximately $5.77 billion. Yet much of the foundry segment’s current revenue comes from manufacturing Intel’s own products, so it should not be treated as equivalent to independent customer demand. The longer-term test remains whether external customers adopt Intel’s advanced manufacturing processes.

The largest caution is the GAAP result. Intel reported a GAAP loss of $2.16 per share—approximately $11 billion—despite its strong adjusted profit. Restructuring, asset-related charges and other exclusions explain much of the gap, but they still represent real economic costs. Capital expenditure is also expected to rise toward $20 billion as Intel expands capacity.

INTC Daily Chart

Intel closed July 23 at $100.23 after trading between $99.25 and $113.66, then recovered to approximately $104–$105 after earnings. The $113–$114 region is immediate resistance because Thursday’s early rally failed there. The $98–$100 area is support. Holding above $100 while reclaiming $110 would strengthen the breakout case; another rejection would suggest expectations have risen faster than confirmed profitability.

Intel $79 put expiring on 24 July 2026

Personally, I sold the $INTC 20260724 79.0 PUT$ for approximately $0.31 per share, collecting premium in exchange for accepting the obligation to buy INTC at $79 if the option finished in the money. The trade was based on my view that elevated implied volatility provided an attractive premium for such a short holding period. As the put’s price declined to about $0.29, the position generated an unrealized gain of roughly 7.17%, benefiting from both time decay and the stock remaining above the strike. The main risk was a sudden reversal before expiry, so the position required sufficient cash to take assignment at an effective purchase price of approximately $78.69, after deducting the premium received.

The evidence leans moderately bullish because revenue growth, AI demand and forward guidance are improving together. The thesis would be invalidated by another deterioration in cash flow, manufacturing delays, failure to secure meaningful external foundry customers or continued large GAAP losses after restructuring should have subsided. This is personal opinion for education and is not financial advice.

@Tiger_SG @Tiger_comments @TigerStars @TigerClub @CaptainTiger @Daily_Discussion

Disclaimer: This article is for informational and educational purposes only and does not constitute financial, investment, or trading advice. The views expressed are personal opinions based on publicly available information and are subject to change without notice. Investors should conduct their own research and consider their financial situation, risk tolerance, and investment objectives before making any investment decisions. I do not guarantee the accuracy or completeness of the information presented.