Quarterly report [Sections 13 or 15(d)]

Operating Segments

v3.26.1
Operating Segments
 3 Months Ended
Mar. 28, 2026
Segment Reporting [Abstract]  
Operating Segments
Note 2 : Operating Segments
We organize and manage our business as follows:
▪Intel Products:
▪Client Computing Group (CCG)
▪Data Center and AI (DCAI)
▪Intel Foundry
▪All Other
▪Mobileye
▪Other
CCG, DCAI and Intel Foundry are our reportable operating segments. In addition to these reportable segments, we present an "all other" category, which is not a reportable segment. When we enter into federal contracts, they are aligned to the sponsoring operating segment.
The accounting policies applied to our segments follow those used by Intel as a whole. A summary of the basis for which we report our operating segment revenues and operating margin is as follows:
Intel Products: CCG and DCAI
▪Segment revenue: consists of revenues from external customers. Our Intel Products operating segments represent most of Intel consolidated revenue and are derived from our principal products that incorporate various components and technologies, including a microprocessor and chipset, a stand-alone SoC, or a multichip package, which are based on Intel architecture.
▪Segment expenses: consists of intersegment charges for product manufacturing and related services from Intel Foundry, external foundry and other manufacturing expenses, product development costs, allocated expenses as described below and direct operating expenses.
Intel Foundry
▪Segment revenue: consists substantially of intersegment product and services revenue for wafer fabrication, substrates and other related products and services sold to Intel Products and certain other Intel internal businesses. We recognize intersegment revenue based on the completion of performance obligations. Product revenue is recognized upon transfer of ownership, which is generally at the completion of wafer sorting. Backend service revenue is recognized upon the completion of assembly and test milestones, which approximates the recognition of revenue over the service period. Intersegment sales are recorded at prices that are intended to approximate market pricing. Intel Foundry also includes certain third-party foundry and assembly and test revenues from external customers that totaled $174 million in the first three months of 2026 and $31 million in the first three months of 2025.
▪Segment expenses: consists of direct expenses for technology development, product manufacturing and services provided by Intel Foundry to internal and external customers, allocated expenses as described below and direct operating expenses. Direct expenses for product manufacturing include excess capacity charges, if any.
All Other
Our "all other" category includes the results of operations from non-reportable segments, including our Mobileye business, our IMS business, start-up businesses that support our initiatives and historical results of operations from divested businesses, including Altera. Altera, which was previously a wholly owned subsidiary, was deconsolidated from our Consolidated Condensed Financial Statements effective September 12, 2025, following the closing of the sale of 51% of Altera's issued and outstanding common stock. Altera's financial results of operations were included in our "all other" category through September 11, 2025. The financial results of our "all other" category include intersegment product and services revenue and intersegment expenses primarily between Altera and our Intel Foundry segment during the periods in which we consolidated Altera.
We allocate operating expenses from our sales and marketing group to the Intel Products operating segments and allocate substantially all our operating expenses from our general and administration groups to our reportable operating segments.
We estimate that the substantial majority of our consolidated depreciation expense in the first three months of 2026 and 2025 was incurred by Intel Foundry. Intel Foundry depreciation expense is substantially included in overhead cost pools and then combined with other costs, and subsequently absorbed into inventory as each product passes through the manufacturing process and is sold to Intel Products or other customers. As a result, it is impracticable to determine the total depreciation expense included as a component of each Intel Products operating segment's operating income (loss).
We do not allocate the following corporate operating expenses to our operating segments:
▪restructuring and other charges;
▪share-based compensation; and
▪certain acquisition-related costs, including amortization and any impairment of acquisition-related intangibles and goodwill.
We do not allocate the following non-operating items to our operating segments:
▪gains and losses from equity investments;
▪interest and other, net; and
▪income taxes.
Our CEO is our CODM. The CODM uses segment revenue and segment operating income (loss) to evaluate each segment's performance and allocate resources. These financial measures are utilized during our budgeting and forecasting process to assess profitability and enable decision making regarding strategic initiatives, capital investments and personnel across all operating segments. Segment operating results regularly reviewed by our CODM also include total cost of sales and operating expenses directly attributable to each segment. We centrally manage all procurement, treasury and asset management functions across the enterprise and do not maintain separate balance sheets by segment within our systems of record, nor does our CODM receive total asset information by segment for purposes of assessing segment performance and allocating resources.
Intersegment eliminations: Intersegment sales and related gross profit on inventory recorded at the end of the period or sold through to third-party customers is eliminated for consolidation purposes. The Intel Products operating segments and Intel Foundry are meant to reflect separate fabless semiconductor and foundry companies, respectively. Thus, certain intersegment activity is captured within the intersegment eliminations upon consolidation and presented at the Intel consolidated level. This activity primarily relates to inventory reserves, which are determined and recorded based on our accounting policies for Intel as a whole but are only recorded by the Intel Products operating segments upon transfer of inventory from Intel Foundry. If a reserve is identified that relates to neither Intel Products operating segments nor Intel Foundry, the reserve is recognized as activity within the intersegment eliminations for Intel on a consolidated basis.
Net revenue, cost of sales and operating expenses and operating income (loss) for each period were as follows:
Three Months Ended
(In Millions) Mar 28, 2026
Intel Products
CCG DCAI
Total Intel Products
Intel Foundry
All Other
Corporate Unallocated
 Intersegment Eliminations
Total Consolidated
Revenue $ 7,727  $ 5,052  $ 12,779  $ 5,421  $ 628  $ —  $ (5,251) $ 13,577 
Cost of sales and operating expenses
 5,211  3,510  8,721  7,858  526  5,080  (5,472) 16,713 
Operating income (loss)
 $ 2,516  $ 1,542  $ 4,058  $ (2,437) $ 102  $ (5,080) $ 221  $ (3,136)
Three Months Ended
(In Millions) Mar 29, 2025
Intel Products
CCG DCAI Total Intel Products
Intel Foundry
 All Other Corporate Unallocated Intersegment Eliminations Total Consolidated
Revenue $ 7,629  $ 4,126  $ 11,755  $ 4,667  $ 943  $ —  $ (4,698) $ 12,667 
Cost of sales and operating expenses
 5,268  3,551  8,819  6,987  840  1,260  (4,938) 12,968 
Operating income (loss) $ 2,361  $ 575  $ 2,936  $ (2,320) $ 103  $ (1,260) $ 240  $ (301)
Corporate Unallocated Expenses
Corporate unallocated expenses include certain operating expenses not allocated to specific operating segments. The nature of these expenses may vary, but primarily consist of restructuring and other charges, share-based compensation and certain acquisition-related costs.
Three Months Ended
(In Millions) Mar 28, 2026 Mar 29, 2025
Restructuring and other charges1
$ 4,070  $ 156 
Share-based compensation 621 
684 
Acquisition-related costs 113 
151 
Other 276  269 
Total corporate unallocated expenses $ 5,080  $ 1,260 
1 See "Note 6: Restructuring and Other Charges" within Notes to Consolidated Condensed Financial Statements for further information.