Intel reported third-quarter revenue of $16.5 billion, up 21% year on year. Its data centre and AI segment grew 78% to $7.3 billion, while the client computing segment fell 5% to $8.1 billion. For the fourth quarter the company forecasts revenue of $15 billion to $16 billion, below estimates, citing a weak PC market. The shares fell more than 20% in after-hours trading.

What it means: Intel's picture sums up the two-sided reality of the processor market. Demand for servers that support AI applications is strong, because every system with graphics cards also needs central processors, and companies are refreshing their data centres. By contrast, the desktop and laptop market stays sluggish, and high memory prices, driven up by AI demand, raise the cost of every device. For businesses and public bodies planning to replace equipment, that means more expensive computers and possible delivery delays, something worth building into 2027 budgets. The fall in the share price shows investors are more worried about the fourth quarter than the past, while Intel continues to invest heavily in its factories and in serving outside customers. Its success in making chips for others also matters for Europe, which wants to depend less on Asia for semiconductor production. The strong rise in data centres shows the company is regaining ground in a market where it lost share in recent years.

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