Intel shares jump 5.1% on rare Bank of America upgrade

Intel shares – Intel’s stock rose 5.1% in the morning session after Bank of America moved it to Buy from Underperform and raised its price target to $135 from $96, pointing to stronger server CPU demand tied to agentic AI workloads and improved visibility for Intel Foundry.

At the start of the trading day. Intel’s rally looked like a clean jump—shares up 5.1% in the morning session. The reason traders latched onto wasn’t just momentum. It was a rare double upgrade from Bank of America. and it came with a big number attached: a move to Buy from Underperform and a price target lifted to $135 from $96.

Bank of America also framed Intel’s “foundry story” as something investors had already been bidding for—but now. the sell-side backing was formal. The upgrade cited two drivers. One was stronger server CPU demand linked to agentic AI workloads. The other was improved visibility for Intel Foundry after reported plans tied to Google/Alphabet to have Intel produce more than three million TPUs in 2028.

That “more than three million” figure sits at the center of the current re-rating chatter. The catalyst for the week’s shift landed in The Information. which reported that Google had placed a production order for 3 million-plus TPUs through Intel in 2028. Separate estimates cited in the reporting—Morgan Stanley estimated Google could build more than six million TPUs across 2027 and 2028—would make Intel’s reported share roughly half of that two-year plan.

Not every firm is willing to treat the scope as settled. JPMorgan argued the Google chips may still be fabricated at TSMC. with Intel handling packaging only. and dismissed the excitement as a “storm in a teacup.” If JPMorgan’s narrower interpretation is right. the strategic impact would still matter—Intel would be in the mix of hyperscaler supply chains—but it would be smaller than the kind of full-leading-edge foundry win the most optimistic investors are paying for.

The debate is getting sharper because the market is also trying to map Intel’s manufacturing strengths onto a world where advanced packaging capacity is strained. Industry reports have pointed to Intel’s EMIB advanced packaging, with yields said to be around 90% in validation. But the same reporting notes that figure was derived from trade/analyst channels rather than appearing in Bank of America’s headline upgrade text.

There’s more coming from the tooling side, too. Nvidia. separately. is running early multi-project wafer tests on Intel’s 18A process for a multi-die GPU design tied to its Feynman architecture. Nvidia has not placed a production order. In other words. the tests signal interest. but the market is still waiting for the type of commitment that turns “possible” into “ordered.”.

Google and Intel have not officially confirmed any deal.

The upgrade’s confidence also leans on Intel’s own recent financial delivery. Intel’s Q1 2026 revenue was $13.58 billion, beating consensus by about $1.16 billion. Data Center and AI rose 22% to $5.1 billion. Bank of America’s upgrade treated those results as enough to upgrade the foundry turnaround under CEO Lip-Bu Tan—from story to a plausible commercial path. Still, the case remains heavily dependent on unconfirmed customer wins.

Behind the stock move is a broader commercial logic that’s hard to ignore: AI demand has strained TSMC’s capacity. especially in advanced packaging. and that has pushed hyperscalers toward second sources. D.A. Davidson’s Gil Luria added another layer in comments carried with the coverage. saying supporting Intel also supports U.S.-based manufacturing—an issue for companies navigating relations with the current administration.

One big takeaway from today’s session is that the market isn’t treating the news as fully resolved—just meaningful. Intel shares have been extremely volatile, with 51 moves greater than 5% over the last year. In that context. the size of today’s gain suggests traders see a real catalyst. but not something that would instantly erase the core uncertainties.

Those uncertainties have been building in the broader market as well. The previous big move came two days ago. when the stock dropped 3% after a midday Apache helicopter incident over the Strait of Hormuz removed the stable macro backdrop the semiconductor sector needed to extend its recovery. U.S. Central Command confirmed an American Apache helicopter had gone down near the coast of Oman. and President Trump said the U.S. “must respond” to what he described as an Iranian attack over the Strait of Hormuz.

Semiconductor valuations are acutely sensitive to the rate and inflation picture. and that kind of geopolitical escalation tends to keep oil prices elevated. That keeps the 10-year yield elevated and compresses the high multiples the sector carries. The 10-year was already at 4.53%, and the rate-hike probability for year-end already exceeded 50% before the headline.

The helicopter incident hit just as the sector bounce was consolidating, pulling it back before the CPI reading later in the week. The concerns from the previous week’s rout—Broadcom’s cautious AI guidance, a memory chip glut, and the May jobs report pushing yields higher—hadn’t fully gone away.

Even after today’s surge, Intel’s comeback is still uneven. Intel is up 187% since the beginning of the year, but at $113.22 per share, it trades 12.5% below its 52-week high of $129.44 from May 2026. For investors who bought $1,000 worth of Intel’s shares five years ago, the value is now $1,957.

Right now, the rally rests on an uncomfortable mix of momentum and proof. Bank of America has stepped in with a double upgrade and a higher price target. The market’s excitement is tied to a reported Google production order for 3 million-plus TPUs in 2028 and the possibility that Intel’s foundry path could become a real revenue engine. But JPMorgan’s skepticism about whether Intel is fabricating—or only packaging—and the fact that Google and Intel have not confirmed the deal keep the story in motion rather than closed.

Intel INTC Bank of America upgrade foundry Intel Foundry TPUs Google JPMorgan TSMC packaging EMIB 18A agentic AI workloads