AI hardware is at the heart of today’s market story, with veteran investor Hermann Hauser warning that an AI bubble may be forming, even as he calls this one of the biggest value creation waves in tech history. That mix of excitement and risk is where opportunity often hides. This article walks through 3 stocks exposed to these AI computing shifts and how the latest news might matter for your watchlist.

The stocks covered below are just a small sample, while the full screen surfaced 62 more companies with equally compelling AI hardware narratives that are not included here. If you want to identify potential front runners in next generation compute, go straight to the Next-Generation AI Computing Hardware Innovators screener to filter and analyze the field for your highest conviction ideas.

Soitec (ENXTPA:SOI)

Soitec is a France based semiconductor materials company that designs and manufactures engineered substrates such as silicon on insulator and photonics wafers used in smartphones, automotive chips, power electronics and AI data center hardware. The business currently reports all its €592 million in revenue from its Electronics segment, reflecting a focus on high value wafers supplied to chipmakers across mobile, automotive, edge AI and cloud infrastructure markets. Soitec has a market cap of about €4.8b, which puts it firmly in mid cap territory for global semiconductor suppliers.

For investors watching the shift towards more energy efficient AI hardware, Soitec sits in an interesting position. Its engineered substrates are used in radio frequency, photonics and power platforms that align with concerns about AI’s power and cooling demands, and recent commentary highlights opportunities in both cloud campuses and edge AI devices. At the same time, the company is still loss making, carries funding risk through external borrowing and faces pressure from excess inventories and tougher competition in newer areas like silicon carbide. For anyone seeking exposure to the underlying materials that enable AI hardware rather than just headline chip designers, Soitec may warrant closer observation.

Soitec’s loss making profile and AI hardware exposure can easily mask what really matters in its funding and execution story. Before you decide how it fits your watchlist, review the 1 key reward and 1 important major warning sign

Build your own AI hardware shortlist

Soitec and the two other AI hardware stocks in this article all surfaced from a single set of screener filters, but the real edge comes when you tailor those filters to your own style. Use our flexible Screener to mix valuation, growth, quality and risk checks, or jump straight into any of our curated Investing Ideas for ready made shortlists.

ON Semiconductor (ON)

ON Semiconductor is a US based chip company that supplies power management and sensing components used in electric vehicles, industrial automation, AI data centers and factory robots. It currently generates about US$3.0b from its Power Solutions Group, US$2.2b from its Analog & Mixed-Signal Group and US$900 million from its Intelligent Sensing Group. The stock has a market cap of roughly US$31.8b, which puts it in large cap territory for the semiconductor sector.

ON Semiconductor sits at the point where Hermann Hauser’s AI bubble warning meets real world infrastructure needs. Its power and sensing products are directly tied to AI data center build outs and EVs, with management highlighting fast growing AI data center revenue and rising margins as higher value silicon carbide and power solutions gain traction. At the same time, the company is not a one way bet. Forecasts rely on strong execution in cyclical auto and industrial markets, and recent one off losses plus share price volatility show how quickly sentiment can swing. If you want AI exposure tied to the electricity bill rather than just chips in the spotlight, ON’s story deserves a closer look.

ON Semiconductor’s AI and EV exposure is getting attention, but the real story may lie in how its segments fit together and where margins could shift next. Read the analysis report for ON Semiconductor

MACOM Technology Solutions Holdings (MTSI)

MACOM Technology Solutions Holdings designs analog and photonic semiconductors that sit inside wireless base stations, high speed optical links, radar, medical systems and data centers. The company currently generates about $1.2b in revenue from a single integrated business that designs, develops, manufactures and markets semiconductors and modules, and has a market cap of roughly $23.7b.

MACOM Technology Solutions sits at the intersection of Hermann Hauser’s AI hardware thesis and real world infrastructure demand, with its RF and lightwave chips used in high speed optical interconnects that link AI clusters and data centers. Management points to strong bookings, a growing data center pipeline and expansion into 800G and 1.6T connectivity, which supports the case for ongoing AI related demand. The flip side is that the stock already trades on a rich valuation, depends heavily on volatile data center, telecom and defense cycles, and still needs to prove that recent fab investments can deliver the margin lift analysts expect. If you want to understand whether MACOM’s AI, SATCOM and defense exposure justifies that optimism, the next section goes much deeper into the story you are only getting a glimpse of here.

MACOM’s surging AI optics story and rich valuation often feel out of sync. That gap could matter far more than the headlines. See how the analyst forecasts for MACOM Technology Solutions Holdings reframes the risk reward before the next leg of this story comes into focus

Seeking Alternatives Before The Crowd Moves

Fresh ideas do not stay under the radar for long. By the time momentum is strong, the most attractive entry points can already be gone. Scan for tomorrow’s potential opportunities and consider acting early.

• Identify companies with rising cash strength and low debt profiles by running the list of solid balance sheet and fundamentals (432 results). Do this before quality balance sheets may become fully reflected in prices.
• Look for resilient compounders that could hold up when others are dropping by checking the 299 resilient stocks with low risk scores. Consider this before many investors focus on the same defensive names.
• Focus on miners with meaningful production scale using the 9 top copper producer stocks. This can help highlight potential beneficiaries of long term infrastructure demand while they may still be less widely followed.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.