Intel Quashed Its Dividend in 2024. Now the Stock's Up 389% and Investors Want It Back.

Dividend tech stocks are a rare breed. I mean, technically NVIDIA (NASDAQ: NVDA) and Apple (NASDAQ: AAPL) pay dividends, but the yields barely reach 1%. That’s why finding a decent tech company that pays reasonable yields while offering ample room for capital growth is like finding a golden needle in a haystack. 

And a few short years ago, Intel (NASDAQ: INTC) fit that description to a T. The company paid yields that averaged around 2% for more than three decades and increased payouts for eight straight years. Even better, it was at the very top of the semiconductor industry. In fact, back then, AMD (NASDAQ: AMD) and NVIDIA - yes, that NVIDIA - were playing catch-up to Intel for decades. 

But now, that’s all in the past as a series of unfortunate events cast doubt on the company’s future. 

After pouring money into its foundry business, losing market share to AMD, watching NVIDIA dominate the AI revolution, and ultimately cutting its dividend altogether in 2024, Intel went from being the undisputed king of semiconductors and a tech dividend darling to one of Wall Street's biggest disappointments.

But now, things are looking up. Foundry is starting to contribute, the company is clawing its way back into generating meaningful revenue, and Wall Street is warming up to Intel’s potential turnaround story. 

So that begs the question: Can Intel reclaim its glory days from the past? Does its current trajectory open up the possibility of paying dividends again? 

Let’s pop the hood and have a look. 

Intel’s 2026 So Far: Record AI Growth, Estimate Beats, and a Turnaround Taking Shape

So far, Intel seems to be on a genuine path to a comeback. The stock’s up 170% year-to-date and 389% in the last 52 weeks. 

Meanwhile, Q2 FY’26’s reported earnings reached $0.30 per share. That is a full 200% above Wall Street’s expectations. 

Revenue also grew 25% year over year to $16.1 billion - the company’s strongest quarterly growth in more than 15 years. 

But the headline numbers hide even better news. Its Data Center and AI segment grew 59%, while Foundry grew 31%. Both of these numbers are hinting at the same thing: Intel’s AI and Foundry bet is starting to pay off. Better late than never. 

In other news, management highlighted improved factory yields and faster cycle times, progress toward risk production on the 18A-P node, and a plan for high-volume 14A manufacturing by 2028. It also doesn’t hurt that the company’s deepening its ties with Alphabet via a strategic partnership through Google Cloud. 

With all that good news, it’s no surprise that many investors are expecting a new dividend announcement to hit the company pressroom. 

But, like with everything else in life, it’s not that simple. 

What the Cash Flow Says About Intel’s Potential Dividend

If you’re a dividend investor, you know that top- and bottom-line numbers don’t tell the whole story when it comes to dividend payments. You’d need to look at free cash flow (FCF) to see whether a company can pay its shareholders. 

Now, on paper, Q2 looked encouraging. Intel generated operating cash flow of roughly $7.0 billion for the quarter, with an estimated $4.45 billion in free cash flow. That's the kind of number that gets dividend investors like me excited.

But remember, Intel had been posting negative free cash flow over the past few years. So, yeah, it’s good news that FCF is now positive, but the company’s got a lot to make up for. 

This is particularly true since capital expenditure is still going up - not as much as last year, but it doesn’t seem like it’s going to slow down anytime soon as Intel continues to expand its foundry business and invest in next-gen silicon production. 

And, even more damning to all our dividend hopes, Intel has not announced a payout yet. Back when it announced the dividend suspension in Q2 FY’24, the company reiterated its “long-term commitment to a competitive dividend as cash flows improve to sustainably higher levels.” 

After that… crickets on the dividend front. 

That said, Wall Street analysts’ revenue and FCF forecasts have been rising alongside investor confidence. Intel's top line is now expected to reach $70 billion by the end of 2027, while FCF is projected to grow to $6 billion. 

So there’s definite improvement. It’s just not at a level where the company can comfortably pay its shareholders like it did in the past.

Bottom Line: What This Means for Intel “Dividend” Investors

So, can Intel bring back its dividend?

The short answer is yes. And I fully stand by it.

But all signs point to the fact that right now is not the time for a comeback. A couple of green marks on the scorecard don't change the narrative - at least not yet.

We need to see all the growth and these improvements continue in the following quarters and years. Management needs to prove that its foundry bet is well worth the wait and that it can catch up to NVIDIA and AMD. 

Still, I take the good news where I can get it. Intel no longer looks like a company in free fall. It’s starting to look like a company rebuilding itself. 

If the current trajectory continues and free cash flow improves over the next couple of years, I wouldn't be surprised to see management revisit its dividend policy. But until then, investors should view any future payout as a bonus, not an expectation.