2 AI Stocks to Buy and Hold for the Long Term: AMD and Broadcom

AMD and Broadcom are two chip stocks to consider buying and holding for the long term. AMD's Ryzen processors have taken significant market share from Intel and is one of only two suppliers of general-purpose GPUs for AI workloads. Broadcom's AI chip revenue grew 46% YoY in the most recent quarter, fueled by demand for custom ASICs. Both stocks offer significant upside over the next few years and beyond, with AMD trading at a forward P/E multiple of 38 and Broadcom's AI chip revenue growing rapidly.

In the dynamic and competitive semiconductor industry, AMD and Broadcom stand out as promising long-term investment opportunities. Both companies are making significant strides in the AI chip market, driven by robust demand and innovative product offerings.

AMD, known for its EPYC processors and Ryzen series, has been gaining market share from Intel, particularly in the data center segment. According to the latest Q1 2025 results, AMD's data center revenue surged by 57% year-over-year to $3.7 billion, driven by strong demand for EPYC CPUs and Instinct GPUs [1]. The company's latest AI-focused MI400 series GPUs further underscore its commitment to an open software ecosystem. Despite facing challenges such as U.S. export restrictions on AI chips to China, AMD's growth trajectory remains promising.

Broadcom, another global technology leader, is also making waves in the AI chip market. The company's AI chip revenue grew by 46% year-over-year in the most recent quarter, fueled by demand for custom ASICs. Broadcom's offerings include AI XPUs and networking ASICs, designed to meet the growing needs of data centers and AI servers [3]. The company's strong performance reflects the increasing demand for high-margin chip sales and recurring software license and support fees.

Both AMD and Broadcom offer significant upside potential over the next few years. AMD's forward P/E multiple stands at 38, indicating a premium valuation, while Broadcom's AI chip revenue is growing rapidly. Investors should consider these stocks for their long-term growth prospects and their positions in the rapidly evolving AI chip market.

References:
[1] https://www.networkworld.com/article/4021291/amd-latest-news-and-insights.html
[3] https://finimize.com/content/avgo-asset-snapshot