Intel announced its third-quarter revenues: The increase continued!

Intel (INTC) is set to announce its third-quarter financial results after the market closes on Thursday. Wall Street is looking for clues about the future of the company's challenging manufacturing segments.

Analysts expect Intel to report quarterly revenue of $13.15 billion, which is below last year's revenue of $13.28 billion. At the same time, the chipmaker's adjusted earnings per share are projected to be $0.01, indicating a significant turnaround from the $0.46 loss in 2024.

Intel's stock price has increased by more than %60 since the last quarterly report in July. During this period, the technology-heavy Nasdaq Composite (^IXIC) only rose by %7.

This increase has occurred alongside layoffs within the company and significant investments from the U.S. government, Nvidia (NVDA), and SoftBank (9984.T). These investments have both strengthened the company's balance sheet and heightened recovery expectations under new CEO Lip-Bu Tan.

However, analysts and investors express that these investments have not contributed much to changing Intel's challenging third-party manufacturing segment. TD Cowen analyst Joshua Buchalter noted in a recent message to investors, "Intel's shares are currently trading based more on external factors. The roadmap of new agreements (product or manufacturing) will not have a short-term impact."

Wall Street is concerned that the heavy spending in this relatively new segment, initiated in 2021, will not yield returns. So far, this business unit has not succeeded in attracting significant commitments from external customers. Nevertheless, policymakers have heavily invested in the company's success as the majority of computer chips worldwide are produced in Taiwan, and Intel is the only major advanced semiconductor manufacturer based in the U.S.

Analysts predict that the manufacturing unit will report an operating loss of $2.2 billion, an improvement from last year's $5.8 billion loss. However, another complicating factor is Intel's decision to no longer promote its latest 18A chip manufacturing process to attract external customers. Initial reports indicate that both Nvidia and Broadcom (AVGO) are testing the technology, but contracts with these companies have not been secured.

Still, Intel is currently focused on its next-generation advanced manufacturing process called 14A. Cantor analyst CJ Muse stated, "The most important focal point will be Intel's ability to secure external customers for 14A, and what will happen if the company fails to do so."

While the company's manufacturing segment continues to lag behind TSMC (TSM), it is losing market share to rivals like AMD (AMD) and Arm (ARM). Nonetheless, Intel's CPUs used in computers and data center servers still hold the majority of the markets, according to data obtained by the data company Bernstein.

Analysts expect Intel's Data Center and Artificial Intelligence segment revenue to increase from last year's $381 million to $634 million. Overall, analysts anticipate that Intel Products revenue will be $12.1 billion, reflecting a slight decrease from last year's $12.3 billion.

Bernstein analyst Stacy Rasgon dampened enthusiasm regarding Intel stock's recent rise in a note sent to investors on Monday, stating that the company's "overall position remains precarious; significant market share losses in the product business continue, production remains uncertain, and Wall Street consensus estimates appear too high for next year."