Intel last night beat Wall Street estimates for third-quarter revenue and profit and raised its full-year revenue forecast.
The chipmaker's results were powered by sales to data centres and easing concerns about slowing demand during the US-China trade war.
The results came as a relief to the industry after dour forecasts from major chipmakers Texas Instruments and Xilinx earlier this week.
After years of acquisitions outside its core area of processing chips under previous leaders, Intel under chief executive Bob Swan has reined in spending, slowing investments in areas like memory chips and shedding struggling businesses.
Intel, based in California, has doubled down on its core markets such as personal computers and data centres, both of which beat analysts' third-quarter expectations.
Its chief financial officer George Davis said Intel anticipated most of the year's data centre spending would come in the second half because many customers bought chips in 2018 and took time to install them.
"Data centre came back much more strongly than even we anticipated this quarter," Davis said in an interview. "Cloud customers actually grew year over year, and last year was an extraordinary year."
Intel has also been contending with a US-China trade war that led to tariffs on its chips.
About $200m of Intel's third-quarter revenue came from Chinese data centre owners purchasing chips sooner than they otherwise would have, likely out of trade concerns, Davis said.
But analysts said they suspected much more of Intel's results were driven by sped-up buying because of tariffs and that could slow sales during the fourth quarter of 2019 and first quarter of 2020.
"We think this could result in the supply chain inventory digestion" as Intel's customers work through the chips they have bought, they added.
Intel, which is racing against rival Taiwan Semiconductor Manufacturing Co to make smaller chips, said the move to the newer process, called 10-nanometer, was on track and it would have its next-generation, 7-nanometer, chips by 2021.
Bob Swan also said Intel was "well down the engineering path" for even more advanced 5-nanometer chips.
Revenue in Intel's client computing business, which caters to PC makers and is the biggest contributor to sales, fell 5% to $9.7 billion, but still beat FactSet estimates of $9.60 billion.
Davis said revenue could have been higher but Intel was unable to make enough chips for entry-level PCs.