Intel's (INTC 1.28%) shares have soared 489%, and Micron Technology (MU +2.70%) stock is up a shocking 869% over the past year. The artificial intelligence spending boom that's currently underway is fueling interest in these stocks, and both could benefit from rising semiconductor demand in the coming years.
But which is the better AI stock to buy right now?
Image source: Getty Images.
There's a lot to like about Micron stock right now
Let's begin with Micron's fiscal 2026 second-quarter (ended Feb. 26) results, in which revenue spiked 196% to nearly $24 billion, and the company's non-GAAP (generally accepted accounting principles) earnings soared 682% to $12.20 per share.
Micron's memory processor business is booming as large technology companies ramp up AI data center spending. Memory chips typically have rapid boom-and-bust cycles -- and it's still unclear how current chip demand will play out -- but management believes that artificial intelligence has "fundamentally recast memory as a defining strategic asset in the AI era."
One sign that the current boom could last longer than usual is that a Micron customer recently signed a five-year memory contract with the company -- the first ever of this length for Micron.
Adding to Micron's long-term prospects is the fact that memory chips could become an integral part of robotics systems. The company's management believes this could become a growth cycle spanning the next two decades as robotics accelerate and becomes "one of the largest product categories in the technology world," according to Micron CEO Sanjay Mehrotra.
NASDAQ: MU
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Intel's stock has been a huge success lately
Intel's stock has gained 480% over the past year (as of this writing), making the company an unlikely success with investors. I say unlikely because, for years, the company's chip designs and foundry business have been left in the dust by competitors.
The narrative around Intel has shifted, mostly for two reasons: CPUs are becoming more popular for AI inference, and investors are hoping its chip manufacturing business is set for a resurgence.
I'll start with the manufacturing angle because, while Intel is winning some contracts with new customers, its foundry business is still losing money. In Q1 2026, Intel's chip manufacturing segment posted a $2.4 billion loss, despite sales of $5.4 billion.
Some investors are hoping new contracts with Apple, Microsoft, and SpaceX, along with a recent investment from the U.S. government, will help Intel's foundry business accelerate. Still, for now, this segment remains unprofitable, and its new deals haven't yielded significant financial gains for the company.
But Intel's potential to capture more CPU design sales because of AI is a more promising opportunity. Big tech companies are shifting toward CPUs that excel at AI inference and agentic tasks, where GPUs aren't as strong. This market could grow over the coming years, and Nvidia recently highlighted it as a $200 billion AI CPU opportunity.
The company still faces stiff competition in this space, but given recent deals with tech companies and recent government investments, there's potential for Intel to benefit from the expanding AI CPU market.
NASDAQ: INTC
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Micron is the hands-down winner in this race
I would sum up Intel's current AI opportunities in one word: potential. There's a lot of news surrounding the company and deals right now, but Intel's sales aren't accelerating just yet. Consider that its revenue rose just 7% in the first quarter to $13.6 billion.
Much of Intel's share price gains over the past year seem to stem more from investors' excitement about its potential than from explosive growth.
Meanwhile, as I mentioned earlier, Micron's chip business is booming, and it's flowing to both its top and bottom lines, with sales up 196% to earnings jumping 682% in the most recent quarter.
What's more, Micron's shares look like a better deal. Micron stock has a trailing price-to-earnings (P/E) ratio of 43 -- compared to the tech sector average of 36 -- while Intel's trailing P/E ratio is 904. Yikes, that's expensive.
For investors looking to buy a leading semiconductor stock to continue riding the AI boom, Micron looks like a far better bet than Intel right now.
