Micron vs Taiwan Semiconductor Manufacturing: Which AI Chipmaker Is the Better Buy Right Now?

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Technology (NASDAQ: MU) and Taiwan Semiconductor Manufacturing (NYSE: TSM) -- also known as TSMC. TSMC's 92% gain over the past year would be impressive if it weren't absolutely dwarfed by the nearly 300% increase in Micron's share price over the same period.Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »But investors always need to be looking toward the future. And while both of these companies have produced phenomenal results and have very positive outlooks for 2026 as well, I think one stands out as a much better buy right now for long-term investors.Image source: The Motley Fool.There's no doubt that AI has been a driving force for both Micron and TSMC's recent results.Micron specializes in memory chips, which have seen a recent spike in demand. That's because GPU and other AI accelerator chips require significant amounts of specialty chips called high-bandwidth memory (HBM). That demand has increased recently as new artificial intelligence models use more parameters and larger context windows, requiring more working memory.Micron is just one of three major suppliers of HBM chips. The sudden spike in demand left the entire industry in short supply, driving prices higher. As a result, Micron is seeing good growth in bit shipments for its chips, but pricing is the real driving force behind its stellar earnings growth.Taiwan Semiconductor is the world's largest contract chip manufacturer. It's seen its share grow over the past few years as demand for more advanced chips grows faster than the overall market, and TSMC has the best manufacturing technology in the world. Practically every high-end AI chip comes out of TSMC's facilities.TSMC has also been able to increase pricing amid strong demand for its products. It implemented a price increase earlier this year for its most advanced chips with plans to raise prices annually. As it ramps up its newest chip process, N2, it's charging a significant premium per silicon wafer over the previous generation (although it theoretically can print more chips per wafer). That said, the bulk of its growth stems from printing, packaging, and shipping more chips.Terms and Privacy PolicyPrivacy & Cookie SettingsMore InfoTrending tickersFNMA Federal National Mortgage Association 7.36 +2.59 (+54.30%)MU Micron Technology, Inc. 321.80 -35.27 (-9.88%)BFRG Bullfrog AI Holdings, Inc. 1.0500 +0.5417 (+106.57%)WDC Western Digital Corporation 251.67 -23.67 (-8.60%)ALAB Astera Labs, Inc. 100.27 -12.20 (-10.85%)PortfolioSign in to access your portfolioSign inTop gainersUTHR United Therapeutics Corporation 588.36 +65.53 (+12.53%)BBWI Bath & Body Works, Inc. 18.67 +1.87 (+11.13%)CLMT Calumet, Inc. 35.04 +2.98 (+9.30%)GRDN Guardian Pharmacy Services, Inc. 37.25 +3.09 (+9.05%)AGRO Adecoagro S.A. 15.25 +1.20 (+8.54%)Top losersALMS Alumis Inc. 20.21 -4.59 (-18.51%)LASR nLIGHT, Inc. 54.00 -10.32 (-16.04%)SYY Sysco Corporation 69.30 -12.50 (-15.28%)NN NextNav Inc. 15.27 -2.60 (-14.55%)APLD Applied Digital Corporation 20.55 -3.21 (-13.53%)Most activeNVDA NVIDIA Corporation 165.17 -2.35 (-1.40%)SNAP Snap Inc. 4.0200 +0.0900 (+2.29%)INTC Intel Corporation 41.19 -1.94 (-4.50%)MU Micron Technology, Inc. 321.80 -35.27 (-9.88%)ONDS Ondas Inc. 8.15 -0.65 (-7.39%)Top economic eventsEarnings eventsMy earnings eventsEarnings events