By Daniel Howley

Intel (INTC) will report its first quarter earnings after the bell on Thursday as AI continues to drive increasing demand for the company’s chips.

Intel missed out on the initial AI boom due to its lack of chips capable of running AI models, as well as those from Nvidia (NVDA).

And while Nvidia took full advantage of its AI chip lead, transforming itself into a nearly $5 trillion company, Intel is finally on the cusp of grabbing its own piece of the AI bonanza.

That’s because as AI agents, semi- or fully autonomous AI bots that can perform tasks on users’ behalf, continue to become more popular, central processing units (CPUs) like the ones Intel makes are becoming increasingly important to data center companies and hyperscalers.

The reason? While AI models still largely run on GPUs or similar offerings from Amazon (AMZN) or Google (GOOG, GOOGL), the tasks that AI agents perform, such as browsing websites or searching for data in spreadsheets, rely on CPUs.

And that’s making the humble chip far more popular.

For Q1, Intel is expected to report earnings per share (EPS) of $0.01 on revenue of $12.36 billion, according to Bloomberg analyst consensus data. The company saw EPS of $0.13 and revenue of $12.67 billion in the same quarter last year.

The company’s Data Center and AI business is expected to generate revenue of $4.41 billion, up 6.8% year over year. During its fourth quarter earnings call, Intel noted it faced supply constraints on its chips due to high demand but anticipates that to improve after Q1.

Intel is also contending with the fallout from the broader memory chip shortage, which is suppressing PC sales.

Source: Yahoo Finance