The semiconductor industry continues to grow in importance. Semiconductor chips are at the center of consumers' most popular electronic devices, and they also power the cloud computing networks that businesses rely upon every day.

As new, advanced technologies like artificial intelligence (AI) take center stage, the semiconductor industry will become even more critical to the broader economy. How can investors get involved?

Two particular chip stocks soared in 2023. Despite their gains so far, there's likely room for further upside, especially over the long term. Here's why they're a buy now. 

1. Advanced Micro Devices

Advanced Micro Devices (AMD 2.08%) stock is up 65% to start 2023. It's still trading down 32% from its all-time high, but that might be an opportunity for investors who haven't bought it yet, and here's why. 

AMD experienced an abrupt slowdown in its business over the last 12 months, led by declining sales of its personal computing and gaming chips. Those segments rely heavily on consumer spending, and given the current high-inflation, high-interest-rate environment, the weakness is unsurprising. 

But in the first quarter, the company said the second half of 2023 should be much stronger, and it also revealed more information about its long-term artificial intelligence (AI) strategy. AMD is aggregating its best AI teams under one department, overseen by the ex-CEO of adaptive computing giant Xilinx, which AMD acquired for $49 billion last year. 

The change will help accelerate the company's progress in AI ahead of the wide release of its MI300 data center chip later this year. During Q1, a team of researchers used Europe's fastest supercomputer (LUMI) to train the largest finished language model to date. LUMI is powered by AMD's MI250X chips, and since the MI300 will deliver an estimated eight-times-greater performance, customers are very excited about its release. 

The MI300 will be the world's first APU (advanced processing unit), which combines CPU and GPU technologies. It's AMD's latest attempt at disrupting Nvidia, which currently has a 90% market share in the AI semiconductor space. 

Emerging concepts like generative AI could add $200 trillion to the global economy by 2030, which means demand could explode for advanced data center chips between now and then. AMD's core consumer segments might be sluggish right now, but over the long term, it could become one of the world's largest companies on the back of AI. 

2. Axcelis Technologies

Axcelis Technologies (ACLS 0.97%) is one of 2023's top-performing semiconductor stocks, with a gain of 81% so far this year. It's trading near an all-time high, so investors might not get a chance to buy it at a discount, but here's why they don't need one. 

Axcelis doesn't produce any chips itself, so it's less susceptible to the ebbs and flows of the broader economy than AMD. Instead, it manufactures ion implantation equipment, which is key to the fabrication process. Its customers are large chipmakers who are expanding their production capacity for the long term.

The company ended 2022 with an order backlog worth $1.1 billion, which grew to $1.27 billion in the first quarter of 2023. It highlights growing demand despite the short-term slowdown in sales across the industry -- primarily because Axcelis' customers are thinking about their production needs years in advance. 

The company's revenue grew 24.7% in Q1 to $254 million, which was comfortably above its guidance of $240 million. As a result, management increased its full-year 2023 revenue forecast by $30 million to $1.03 billion. At the bottom line, Axcelis' earnings per share grew by 17.2%. 

Based on the company's trailing-12-month earnings of $5.67, its stock trades at a price-to-earnings (P/E) ratio of 24.9. Despite its enormous gain this year, Axcelis stock is still cheaper than the broader tech sector on average, represented by the 28.1 P/E ratio of the Nasdaq-100 index. 

But since the company continues to grow so quickly, and since its future revenue is supported by its massive order backlog, there's a valid argument Axcelis stock should be trading at a premium to the market instead. That's why it's not too late for investors to buy in.