As the PC market collapse began to ease, chipmaker Intel unexpectedly reported a quarterly profit and anticipated third-quarter earnings beyond Wall Street projections, pushing its shares up almost six percent.

Due to consumers having already purchased the computers they required for the pandemic, the personal computer market has been in free fall for the past year.

However, the excess supply has begun to subside, with PC shipments declining only 11.5 percent in the June quarter compared to a 30 percent decline in each of the two prior quarters, according to Canalys statistics.

Intel predicted stronger margins for the third quarter as a result of the rebound in the PC market. Intel stated on Thursday that it anticipates profit margins to increase in the second half of the year despite recent quarters in which they were almost half of historical highs.

"Intel did outperform almost exclusively on the strength of desktop sales which rebounded from a near-record low last quarter," said Edward Snyder, analyst at Charter Equity Research.

The market value of Intel increased by around $9 billion as a result of the stock surge, which is a significant improvement over prior years when compared to rivals like Nvidia, Advanced Micro Devices, and Broadcom.

The company's largest sector, which comprises personal computers, has experienced sharp reductions for more than four straight quarters. This quarter, revenue fell 12% to $6.8 billion from $7.7 billion in the same quarter last year.

The foundry division of Intel, which produces chips for other companies and accounts for a minor portion of its sales, reported revenue of $232 million, an increase from $57 million a year earlier.

The company said that it would collaborate with Swedish telecom equipment manufacturer Ericsson on a chip that Intel will manufacture using its most cutting-edge manufacturing technology to date.

Sales for Intel's data center and artificial intelligence division dropped from $4.7 billion to $4 billion, a 15 percent decrease, in the previous quarter.

The market for server processors for Intel has suffered from a slow recovery in China as well as a concentration on chips that are suitable for AI computation in the cloud.

In contrast to predictions of 40.6 percent, Intel projected an adjusted gross margin of 43 percent for the third quarter.

In expectation of an industry revival, Intel shares have increased by around 30 percent so far this year, compared to a 50 percent jump on the Philadelphia SE Semiconductor index.