10 Best Semiconductor Stocks With The Highest Upside Potential

2. Astera Labs Inc. (NASDAQ:ALAB)

Upside Potential: 78.55%

Market Capitalization: $11.17 Billion

Number of Hedge Fund Holders: 51

Astera Labs Inc. (NASDAQ:ALAB) is a global semiconductor company that provides high-performance connectivity solutions for cloud and AI infrastructure. Its products help solve data, network, and memory issues in large-scale cloud and AI systems. Its main offering is the Intelligent Connectivity Platform, which includes high-speed hardware and software called COSMOS to manage and optimize systems. It primarily targets hyperscalers, large cloud service providers like Amazon, Microsoft, and Google, that need efficient infrastructure for handling massive amounts of data.

Astera Labs Inc. (NASDAQ:ALAB) achieved a record revenue of $141 million in Q4 of 2024, a 25% increase from the previous quarter and a whopping 179% year-over-year growth. The company reported $396 million in total revenue for 2024, marking a 242% year-over-year growth. It also reported a non-GAAP gross margin of 76.6% for the year. The company anticipates a breakout year in 2025 with significant growth from all of its four product families. It plans to expand its product portfolio with differentiated hardware and software solutions across multiple protocols. It aims to capitalize on the growing market for high-speed connectivity in AI infrastructure and expects the market opportunity for its products to grow substantially through 2028, potentially reaching a $12 billion market.