As the U.S. equity market continues to navigate uncertainty, investors are advised to concentrate on artificial intelligence (AI) companies that offer cutting-edge technologies and demonstrate multi-year revenue visibility. With a challenging macroeconomic environment prompting caution, this pullback may present an opportunity for retail investors to acquire stakes in high-quality AI leaders. Below are three standout AI stocks that merit attention.
1. Taiwan Semiconductor Manufacturing Company (TSMC)
Taiwan Semiconductor Manufacturing Company (TSM 3.09%) is an essential player in the global AI ecosystem, providing advanced chip manufacturing technologies crucial for producing next-generation GPUs, AI accelerators, and custom chips. TSMC’s robust execution in advanced process nodes was evident in its fiscal 2025 third-quarter results, which showed a 40.8% year-over-year revenue increase to $33.1 billion. This growth was bolstered by efficient cost optimization and improved capacity utilization, resulting in a solid gross margin of 59.5%.
Advanced process technologies, particularly those at 7-nanometers and below, constituted 74% of TSMC’s wafer revenue, with 3-nanometer technology alone accounting for 23%. Notably, the high-performance computing sector emerged as the strongest market, contributing 57% to total revenue.
TSMC plans to commence volume production of its new N2 (2-nanometer) technology by late 2025, and the company anticipates that profitability from this technology will surpass that of its N3 (3-nanometer) counterpart. Furthermore, TSMC aims to enhance its advanced chip packaging capacity, allocating 10% to 20% of its $40 billion to $42 billion fiscal 2025 capital expenditure towards these expansions.
See also
Google Launches Gemini 3, Boosting AI Capabilities with Enhanced Reasoning and Context UnderstandingWith its leadership in advanced chip manufacturing and plans for international expansion, including a newly operational fab in Arizona capable of producing complex AI chips, TSMC appears poised for continued success.
2. Oracle Corporation
Oracle (ORCL 1.62%) has successfully transitioned from a traditional enterprise software and database powerhouse to a pivotal player in AI infrastructure. Its integrated technology stack, encompassing both CPU and GPU-based compute capabilities, positions Oracle to attract significant clients, including OpenAI and Meta Platforms. Currently, over 700 customers utilize Oracle’s accelerated computing services.
In its fiscal 2026 first quarter, Oracle reported a 54% year-over-year increase in cloud infrastructure revenue, reaching $3.3 billion. Cloud application revenue also rose by 10% to $3.8 billion. The company’s remaining performance obligations (RPO) surged by 359% year-over-year, now totaling $455 billion, with expectations to exceed $500 billion by mid-October 2025.
To meet the escalating demand for AI services, Oracle is set to invest $35 billion in capital expenditure during fiscal 2026, with a substantial portion directed towards data center equipment. Additionally, Oracle is focusing on an AI database platform that allows clients to securely analyze private data using advanced AI models. With a growing multi-cloud database business and ongoing development of agentic AI, Oracle is a compelling investment opportunity.
3. ASML Holding N.V.
ASML Holding N.V. (ASML 2.17%) is a key facilitator of the AI industry’s growth, maintaining a near-monopoly on the production of advanced extreme ultraviolet (EUV) lithography systems essential for manufacturing cutting-edge AI processors and high-bandwidth memory chips. In the third quarter, ASML reported revenues of 7.5 billion euros and a net income of 2.1 billion euros. The company secured 5.4 billion euros in net system orders, including 3.6 billion euros from EUV systems.
ASML is advancing its next-generation High-NA EUV systems, which enable the printing of smaller circuit patterns with fewer steps. This technology has already been utilized to process over 300,000 wafers at customer sites. Moreover, ASML has invested 1.3 billion euros in Mistral AI, acquiring an 11% stake to integrate Mistral’s AI models into its lithography software, thereby enhancing system productivity and efficiency.
Despite expecting a decline in sales to China in 2026, ASML anticipates its total revenue will not drop below that of fiscal 2025, driven by robust adoption of EUV systems in advanced chip production. Given its substantial competitive advantage, ASML is well-positioned to benefit from the increasing demand for AI chips over the next decade.
As investors consider their options in the AI sector, companies like TSMC, Oracle, and ASML represent strong opportunities, each with unique strengths that cater to the growing demands of the AI industry.
