I have covered Intel's turnaround story across multiple articles — the layoffs, the 18A yield progress, the management restructuring, the foundry ambitions, just to name a few. Each piece and story added to the mosaic. But nothing validated the thesis like July 23 evening's Q2 results.

Intel reported revenue of $16.1 billion, up 25% year over year. In fact, that's the strongest revenue growth in more than 15 years, according to CEO Lip-Bu Tan. 

Non-GAAP EPS of $0.42 came in nearly double the Street's $0.22 estimate. Q3 guidance of $16.3 billion at the midpoint was well above both Goldman and consensus. We had every major segment beat. Gross margins came in at 41.8% versus the Street's 39.2%.

Goldman Sachs reviewed the results in a note shared with me at TheStreet, raising its estimates by 49% on average while maintaining a Neutral rating and an unchanged $150 price target. 

INTC ranks 6th among S&P 500 stocks year-to-date at approximately 154% in gains, according to Slickcharts. It is also one of the four chip stocks Jim Cramer named as his favorites in my previous coverage.

Goldman's take was candid: a great quarter that cleared an elevated bar. But Intel's closest peers still offer more attractive risk-reward.

Also Read: Intel Corporation Latest News and Stories

The quarter Goldman described as "well above the Street across the board"

The specific beat magnitudes in the Goldman note are worth laying out, according to the research shared.

• Revenue of $16.1 billion was above Goldman's own estimate of $14.3 billion and the Street's $14.4 billion. 

• Gross margin of 41.8% was above Goldman's 39.3% and the Street's 39.2%.

• Non-GAAP operating EPS of $0.42 was nearly double Goldman's $0.23 estimate and the Street's $0.22.

The Data Center and AI segment was the headline driver. DCAI revenue of $6.3 billion grew 24% quarter over quarter and 59% year over year, driven by general-purpose server demand and agentic AI, according to Goldman's note. 

Intel sees an accelerating server CPU market with a strong double-digit CAGR through at least 2028. The company is currently running in a capacity shortage position, and expects stronger sequential DCA growth in Q4 as additional supply comes online.

Related: Alphabet and Intel could reset the AI trade

Client computing revenue reached $8.9 billion, above both Goldman and Street estimates. Intel Foundry revenue of $5.8 billion was also above consensus at $5.5 billion.

"Our Q2 results represent our strongest revenue growth in more than fifteen years," Tan said in the earnings release.