First, "artificial intelligence" is the name of the field of study that tries to build systems that act intelligently, not a term for referring to the produced systems. Even if some outcome isn't (or wasn't) yet particularly intelligent, the name of the field is entirely appropriate since that's the goal which it is striving to approach.
Second, the general consensus of what "intelligence" means in the AI field is approximately the Legg&Hutter "Intelligence measures an agent’s ability to achieve goals in a wide range of environments." from https://arxiv.org/abs/0706.3639 .
It's worth noting that solely focuses on the capabilities of the system and intentionally completely disregards how it's built. Gears cannot be called intelligent iff it is impossible to build an system that acts intelligently solely from gears, and if it turns out that it is possible to build a gear arrangement that soundly demonstrates intelligent behavior, then those gears definitely could be called intelligent.
And it's also a clearly nonbinary definition - i.e., it's not whether something is or isn't intelligent, but a scale to measure how intelligent it is; and a observation that a particular system (or human!) demonstrates poor intelligence doesn't prevent us from discussing that it's more intelligent than something or someone who is even worse.
Second, the general consensus of what "intelligence" means in the AI field is approximately the Legg&Hutter "Intelligence measures an agent’s ability to achieve goals in a wide range of environments." from https://arxiv.org/abs/0706.3639 .
It's worth noting that solely focuses on the capabilities of the system and intentionally completely disregards how it's built. Gears cannot be called intelligent iff it is impossible to build an system that acts intelligently solely from gears, and if it turns out that it is possible to build a gear arrangement that soundly demonstrates intelligent behavior, then those gears definitely could be called intelligent.
And it's also a clearly nonbinary definition - i.e., it's not whether something is or isn't intelligent, but a scale to measure how intelligent it is; and a observation that a particular system (or human!) demonstrates poor intelligence doesn't prevent us from discussing that it's more intelligent than something or someone who is even worse.