Intel’s improved results for the first quarter of 2026 were attributed to increased sales of central processing units (CPUs) that would normally be discarded or classified as lower-grade products.

An online outlet, GigaZine, reported on April 27 that Intel’s first-quarter revenue rose 7 percent from a year earlier to $13.6 billion, far exceeding market expectations.

Profitability drew attention in the results. Analyst Ben Bajarin said he heard directly from Intel’s investor relations team that customers actively bought CPUs that would otherwise be treated as defective or low quality, bringing Intel tangible profits. That highlighted that Intel’s higher yields reflected not just manufacturing efficiency gains but also the market absorbing chips with lower expectations.

In the CPU production process, individual dies are cut from a wafer. Dies from the wafer’s edge tend to be lower quality than those from the center, with a higher likelihood of defects and weaker performance. Bajarin explained that CPU demand has been so strong recently that sales of these potentially lower-spec CPUs have increased sharply. He said customers were more willing than before to accept lower-performance chips.

The trend also intersects with Intel’s difficulties in defending market share. Intel’s share has fallen in recent years as AMD has closed in. The outlet noted AMD recorded more than 36 percent share in desktop PCs, 26 percent in laptop PCs and close to 30 percent in servers. For Intel, there was a strong incentive to widen the range of chips it could sell while demand remained high to protect its performance.

The results also exceeded market expectations. Intel’s earnings per share surpassed estimates by as much as 3,000 percent. Revenue growth was limited to 7 percent, but the ability to sell a wider range of chips makes it possible to interpret that profitability gains became larger.

Intel has also recently signaled business expansion. The company signed a multi-year contract with Google to supply chips for developing next-generation artificial intelligence (AI). With competitive pressure rising in the PC CPU market, the move is seen as an effort to secure demand for AI infrastructure as a new growth engine.

The first-quarter results can therefore be seen as a case showing how far the range of sellable chips has expanded, rather than a simple revenue rebound. Going forward, the focus is expected to be whether CPU demand stays as strong as it is now, and whether Intel can move beyond a temporary profitability improvement to defend share and expand new contracts.