AI Chip Stocks That Could Benefit From the Nvidia Surge

Key takeaways

• Nvidia stock surged to highs of +26% in a day, which has prompted a surge in AI chip maker stocks
• TSMC and ASML, which manufacture Nvidia’s chips, both spiked 4.2% and 6.25% respectively
• Not every company was a winner on the markets: Intel and Qualcomm both saw losses

Wall Street was wowed by Nvidia’s Q1 earnings, which smashed the earnings per share and revenue targets, and the fact it boosted its Q2 revenue forecast to $11 billion which is way ahead of the $7.2 billion analysts predicted.

The results were proof the AI boom is here to stay, and investors can make some serious money from the companies in the space. Here are some of the companies the benefited from ‘the Nvidia effect’ — and the ones which lost out.

The AI revolution is here and you can use the tech right now as part of your investment strategy. The Emerging Tech Kit uses AI to sift through the data, find the tech stocks and ETFs set to perform well and adjust the Kit’s weightings as needed to help you build wealth.

Download Q.ai today for access to AI-powered investment strategies.

AI chip makers to watch

Now investors think AI is the real deal, there’s a lot of potential for smaller companies to benefit from the Nvidia halo. Both of Nvidia’s manufacturing partners benefited from the stellar earnings report because while Nvidia designs and sells the chips, it doesn’t manufacture the parts.

The Taiwan Semiconductor Manufacturing Co, which provides Nvidia with the semiconductors, rose 4.2% in the Taiwan market while Netherlands-based ASML, which manufactures the semiconductors, is up 6.25%. As long as Nvidia keeps needing these chips, there’s no real sign of either of these stocks slowing down.

And other chip makers not directly connected to Nvidia and in competition with the company also saw a boost. Advanced Micro Devices, also known as AMD which also specializes in high-end GPU products, was up a significant 11% on Thursday.

There’s also the infrastructure around AI chip makers that have also enjoyed some serious gains thanks to the AI stocks rally. Japanese semiconductor testing equipment company, Advantest, has soared 21% in the last five days. Hynix, a South Korean semiconductor manufacturer, has seen a 5% boost today.

Dutch semiconductor company BE Semiconductor Industries saw its stock rise 7% this week, while Monolithic Power Systems, which provides the power systems for cloud computing, has skyrocketed over 17% in just one day.

A cautionary note for other companies

Intel might not appeal to investors however, after falling 5% at Nvidia’s announcement. The company focuses on traditional CPU processors instead of the newer GPU products, which left traders concerned about the company’s ability to innovate. Mobile chip maker Qualcomm also briefly dipped 1.3% before recovering.

The bottom line

Nvidia’s shares surge, and the accompanying AI tech stocks rally, is either proof that AI is the next big tech or we’re in a massive AI bubble. Either way, the short-term gains have been impressive and there’s potential for investors to benefit from the upside.

Use AI to prop up your portfolio with the Global Trends Kit. This low-risk investing option holds stocks and bonds, forex and commodities, all assessed by an AI algorithm each week to see which is doing the best. It then updates the holdings as needed to help you stay one step ahead.

Download Q.ai today for access to AI-powered investment strategies.