Intel Shares Rally to Four-Year High Fueled by Server Chip Demand

2026-01-22 companies

Santa Clara, Thursday, 22 January 2026.
Shares surged 11% as analysts reveal Intel is nearly sold out of server processors through 2026, driving valuations to their highest point since early 2022.

Unprecedented Demand Meets Technical Optimism

On Wednesday, January 21, 2026, Intel Corporation (INTC) shares experienced a dramatic surge, climbing approximately 11% to reach their highest valuation since early 2022 [1][5]. This rally, which brings the stock’s year-to-date gains to over 30%, appears to be driven by a confluence of aggressive market positioning and supply scarcity [2]. According to analysts at KeyBanc, the semiconductor giant has effectively sold out of its server processor supply through the end of 2026 [8]. This inventory tightness is attributed to unprecedented demand from hyperscalers specifically targeting “agentic” artificial intelligence workloads, a trend that has allowed Intel to exercise significant pricing power [8]. Consequently, the company is seeing potential average selling price increases of 10% to 15% on these critical components [8].

Technological Advantage Over Competitors

Beyond immediate supply constraints, investor sentiment is being buoyed by Intel’s perceived technological lead in next-generation manufacturing. The company’s “backside power delivery” technology—a method that boosts efficiency by delivering power to the back of the chip rather than the front—has emerged as a key differentiator [5]. While Intel is deploying this in its 18A process, competitors like TSMC are reportedly lagging behind, with plans to introduce similar technology roughly six months to a year later [5]. This 6-12 month window of exclusivity provides Intel with a critical strategic advantage in a market hungry for power-efficient computing solutions [5].

Earnings Outlook and Strategic Investments

As markets prepare for Intel’s quarterly earnings report scheduled for release after the close today, Thursday, January 22, expectations are calibrated against a backdrop of recovery [1]. Analysts forecast fourth-quarter revenue to come in at $13.4 billion, representing a 6% year-over-year decline [8]. Despite this projected revenue dip, confidence in the company’s turnaround under CEO Lip-Bu Tan, who was appointed in March 2025, remains high [1]. This sentiment is reinforced by massive external validation; the U.S. government became the company’s largest shareholder last year following an $8.9 billion investment, while Nvidia injected $5 billion into the chipmaker, a stake that has since grown in value by over $6 billion [1].

Valuation Risks Amidst the Rally

Despite the exuberant price action, a divergence in analyst opinion suggests caution is warranted. While Seaport Research Partners recently upgraded the stock to a “Buy” with a $65 price target, the broader consensus remains more conservative [8]. The average price target for Intel sits at $44.29, which implies a significant downside risk of approximately 18% from recent highs [5]. Furthermore, a discrepancy of 46.76% exists between the bullish Seaport target and the market average, highlighting the volatility in expectations. Fundamental risks also persist; tightening global memory supply threatens to impact PC demand, potentially complicating the recovery for Intel’s Client Computing Group [3]. As the company reports later today, investors will be scrutinizing whether the demand for server chips can sufficiently offset these lingering execution risks [3][7].

Sources

Semiconductors Intel Corporation