Motley Fool picks Qualcomm over ASML as better AI stock

ASML's position rests on being the sole provider of extreme ultraviolet lithography machines, the equipment needed to print circuits on the most advanced AI chips. That monopoly has produced steady growth: FY 2025 revenue of $36.6 billion, up 15.6%, with net income of $10.8 billion and $12.4 billion in free cash flow. The trade-off is exposure to export controls and a customer base concentrated among a few large chipmakers, which means any delay in factory expansions can ripple into order cancellations.

Qualcomm's story is different. Its FY 2025 revenue grew 13.7% to $44.3 billion, but net income fell to $5.5 billion from $10.1 billion as research spending rose and product costs shifted. Its handset business, which counts Apple and Xiaomi among major customers, faces a mature market and rising component costs. The September 2026 Amazon partnership is the first concrete sign that its push into data center AI chips and optical networking is gaining traction, which the analyst argues could restore revenue growth. Qualcomm also carries more leverage, with a debt-to-equity ratio of 0.8x versus ASML's 0.1x.