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Artificial Intelligence Stock Comparison: ASML versus Advanced Micro Devices

AI sector giants ASML and AMD are crucial elements, driving impressive sales for both entities in the thriving AI market during the current year.

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Artificial Intelligence Stocks: ASML outperforms AMD for improved returns
Artificial Intelligence Stocks: ASML outperforms AMD for improved returns

Artificial Intelligence Stock Comparison: ASML versus Advanced Micro Devices

In the rapidly expanding AI sector, two businesses stand out as intriguing investments: ASML Holding and Advanced Micro Devices (AMD).

According to a recent article, ASML's attractive valuation makes it the more compelling AMD stock to buy right now. This assertion is supported by the improvement in ASML's price-to-earnings ratio (P/E), indicating a more favourable valuation compared to AMD.

ASML's financial performance has been robust. Through two quarters, the company's revenue stood at $18 billion, a significant increase from the prior year's $13.4 billion. Net income also saw a strong increase, reaching $5.4 billion compared to the previous year's $3.3 billion. Operating income rose to $5.8 billion from 2024's $3.7 billion.

The company, which makes cutting-edge lithography machines necessary for producing advanced microchips that power AI systems, sees AI technology as a significant growth opportunity in semiconductors, similar to previous opportunities like PCs, the internet, and smartphones.

On the other hand, AMD's financials have also shown promising signs. The company's net income for the second quarter of 2025 was $872 million, a 229% increase year over year. AMD's diluted earnings per share soared 238% to $0.54 in the same quarter.

However, AMD's sales to China were restricted due to new U.S. government regulations, resulting in a $800 million inventory write-off in the second quarter of 2025. The company is, however, working to get government approval to sell AMD stock to China again.

Despite these challenges, AMD's stock has performed well this year. It's up 35% in 2025 through Aug. 6, following a record $7.7 billion in second-quarter revenue, a 32% year-over-year increase. AMD also sells AMD stock to cloud computing companies such as Microsoft.

The AI sector is projected to grow from $244 billion in 2025 to $1 trillion by 2031, providing a potential growth opportunity for both ASML and AMD.

While the planned restrictions and tariffs announced by President Donald Trump in 2025 caused volatility and negative effects on global stock markets, the specific impacts on ASML Holding's shares are not detailed. US-EU trade tensions led to tariff adjustments such as the reduction of US auto import tariffs on EU cars to 15%, which helped to ease some market pressures, but no direct information on ASML was found.

Meanwhile, Nvidia's share price has also increased over 30% this year through Aug. 6. Investors may want to keep an eye on all three AI-focused companies as the sector continues to grow.

In conclusion, both ASML and AMD offer compelling investment opportunities in the booming AI sector. While ASML's improved valuation makes it an attractive choice, AMD's strong financial performance and strategic partnerships with tech giants like Microsoft could also make it a worthwhile investment.

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