Intel has managed to post a profit for a single quarter, reversing a series of losses, largely due to several one-off financial gains. For the third quarter of 2025, the semiconductor giant reported a net profit of $4.1 billion. However, this figure is significantly influenced by extraordinary income sources, making direct year-over-year comparisons less meaningful.

During this period, Intel benefited from substantial financial inflows, including $5.7 billion from the US government, which now holds a 9.9% stake in the company, $2 billion from investor Softbank, $4.3 billion from the partial sale of its FPGA specialist Altera, and $900 million from the partial sale of automotive technology firm Mobileye. Additionally, a $5 billion investment from Nvidia is anticipated by the end of the year.

In contrast, the third quarter of the previous year was marked by significant write-downs, resulting in a paper loss of $16.6 billion. The actual operational performance of both quarters is more aligned than headline figures suggest. Revenue saw a modest increase of three percent year-on-year, reaching $13.7 billion. Operating income also returned to positive territory, with Intel reporting $683 million in operating profit for the group.

Major Workforce Reduction and Cost Management

The company's financial reports have become challenging to interpret due to these exceptional items. Nonetheless, one clear trend is the significant reduction in Intel's workforce. In the third quarter, approximately 10,000 employees left the company, and an additional 3,300 staff from Altera were also removed from the consolidated headcount. Intel's total employment now stands at 83,300, down nearly 28% from 115,000 a year earlier.

This downsizing has led to a decrease in research and development spending, which dropped to $3.2 billion, representing a 20% decline compared to the previous year. The company has utilized proceeds from external investments to reduce its debt, paying back nearly $3.8 billion.

Core Processors Remain Main Revenue Driver

Despite the changes, Intel's core business of producing processors for notebooks and desktop PCs remains its primary revenue stream. Sales in this segment rose five percent year-over-year to $8.5 billion. However, operating profit from these products fell by eight percent, likely due to lower selling prices.

Products for data centers and servers experienced a slight decline in revenue, totaling $4.1 billion, but profitability in this area improved significantly, with operating income jumping by 153% to nearly $1 billion. The foundry business, which manufactures chips, saw flat revenues at $4.2 billion, all coming from Intel's internal product lines. The lack of major external clients continues to pose challenges for this division, which reported an operating loss of $2.3 billion.

Supply Chain Pressures and Market Outlook

Intel's Chief Financial Officer has warned of ongoing supply constraints affecting the company's entire product portfolio. Demand for CPUs, especially for artificial intelligence workloads in traditional server environments, is rising. However, Intel can only capitalize on this trend to a limited extent due to "definitive shortages," particularly in older processor generations such as Intel 10 and 7, for which production is not set to increase. The company also faces supply issues in chip packaging materials, which are critical components linking CPUs and mainboards.

Looking ahead, Intel forecasts revenue for the fourth quarter between $12.8 billion and $13.8 billion, which would maintain the current level but still fall short compared to the end of 2024, when the company reported $14.3 billion in revenue. Intel anticipates a net loss of $0.14 per share, or around $600 million, for the upcoming quarter, factoring in the expected investment from Nvidia.

Positive Market Reaction

Despite the anticipated return to losses, investors responded positively to the quarterly report. Intel's share price surged by 10% following the announcement and has remained relatively stable since, reaching its highest point since April 2024, even after accounting for share dilution through new issues.