Intel reports Q2 2026 earnings on July 23, with the foundry business in focus. Analysts expect revenue of $14.42 billion and earnings per share of $0.21. The chipmaker is staking its future on Intel Foundry Services, the division making chips for other companies.

Intel’s external foundry revenue in Q1 was $174 million. That’s small, but it’s the first signal of whether Intel can become a real competitor to TSMC and Samsung. The foundry business lost $2.4 billion in operating profit in Q1, a cost of building the infrastructure.

Yields Climbing on 18A

The important metric is yield, which is percentage of working chips from manufacturing. Intel’s 18A node achieved 85% yield in Q1, up from 65% in Q4, a significant improvement. If yields keep climbing, the foundry business can eventually get profitable.

Apple and Microsoft officially joined Intel’s design partnerships for the 18A process. These aren’t orders yet, just early engineering work. But major customers signaling interest changes the calculus for investors.

Data Center Staying Flat

Intel’s most profitable segment, data center, needs to grow faster than 20% for investors to get excited. The Street expects $5.5 billion in data center revenue for the quarter to hit that threshold. If it misses, pressure builds on management to show how foundry will offset PC and mobile weakness.

Gross Margin Guidance

Intel guided to 39% gross margin, a key number that will tell investors whether the company is controlling costs while ramping new processes.

Intel’s foundry bet requires external customers to trust it with their chip designs and years of manufacturing. Yield improvements matter, but customer announcements matter more.