11:13 AM EDT, 10/24/2025 (MT Newswires) -- Intel's ( INTC ) "significant upside" in its Q3 results released late Thursday, especially in margins, was encouraging, Morgan Stanley said in a note Friday.

The company's Q3 "gross margins were notably better, and there are strong conditions evident throughout the businesses," the note said, adding "demand for microprocessors is pretty good."

The upside also reflects Intel's ( INTC ) conservatism under new Chief Executive Lip-Bu Tan, as well as a pattern of "under-promising and over-delivering," Morgan Stanley said.

However, the investment firm added that Intel's ( INTC ) priority "has to be stabilizing CPU market share especially in data centers -- and that's still at risk, as in a major cloud refresh we might see market share pressures."

Morgan Stanley raised Intel's ( INTC ) price target to $38 from $36 and reiterated the company's equal-weight rating.

Price: 38.19, Change: +0.03, Percent Change: +0.08