Intel Surges 5% on Server CPU Upgrade and Classiq Quantum Acquisition Ahead of Thursday Earnings

Intel shares climbed roughly 5 to 6 percent on Monday, reaching approximately $91.82, after New Street Research upgraded the stock to Buy with a $125 price target. The firm cited an acute shortage of server central processing units that it expects to persist for years, arguing the scarcity creates a durable pricing tailwind for Intel's data center business as agentic AI workloads drive demand. The upgrade was reinforced by a Seeking Alpha analysis showing Intel's Data Center and AI segment margins expanded from 16 percent to 39.5 percent year over year, driven by CPU pricing power. KeyBanc separately maintained its Overweight rating with a $155 price target, and RBC Capital identified the server CPU demand surge as the key catalyst for the stock to reclaim the $100 level.

Late Monday, Intel announced it has agreed to acquire Classiq Technologies, an Israeli quantum computing software startup, in a deal expected to close in the first half of 2027. Financial terms were not disclosed. Classiq, which has raised more than $200 million and employs around 130 people, develops software that lets companies design and run quantum applications across different hardware platforms. Its customers include BMW and AT&T. CEO Lip-Bu Tan said the acquisition transforms Intel's Quantum Computing Group into a full-stack quantum computing business, combining Intel's hardware with Classiq's software layer. Until closing, the two companies will operate independently.

Also on Monday, Intel unveiled the Crescent Island GPU D Series targeting agentic AI workloads, and separately announced a collaboration with AMD on the oneDNN framework to unify AI software development across x86 CPUs, a move analysts said could sharpen competitiveness against ARM-based alternatives.

Intel is scheduled to report third-quarter earnings after market close on Thursday, October 29, alongside Amazon and SanDisk, in what is one of the busiest earnings weeks of the year with 36 percent of S&P 500 companies reporting. Options markets are pricing an approximately 11 percent move in the stock around the print. Analysts at Seeking Alpha flagged server segment strength, including 48 percent average selling price growth and 61 percent revenue gains year over year, as likely to offset softness in the PC business. Full-year 2026 revenue is forecast at $63.66 billion.