35 Chip Stocks Powering AI Boom

9. Applied Materials, Inc. (NASDAQ:AMAT)

Number of Hedge Fund Holders: 77

Applied Materials, Inc. (NASDAQ:AMAT) provides equipment, services, and software for the semiconductor industry. The company has emerged as a top AI play because of the strength of the DRAM and HBM businesses. DRAM represents around 25% of total semiconductor systems revenue. In the third fiscal quarter of this year, the company achieved 50% year-over-year growth in the DRAM business. This growth was impressive because it happened despite an 11% decline in China. The strength of the DRAM business of Applied Materials lies in investments in key advanced technologies that it has made over the past few years, including Gate-All-Around transistors and backside power delivery.

Applied Materials, Inc. (NASDAQ:AMAT) is a top chip firm on Wall Street. Stifel recently lowered the price target on the stock to $270 from $275 and kept a Buy rating, noting that the Q3 results and outlook of the chipmaker modestly exceeded consensus estimates, reflecting gradual growth in system and service revenue, despite revenue to China being down 24% quarter over quarter, and with China exposure now more de-risked, the advisory underlined that Applied was well-positioned to grow at/above the industry in 2025.