Micron, Broadcom, and Amazon emerge as overlooked chip stocks riding AI boom as Nvidia's GPU dominance faces supply constraints

Micron's memory chip revenue nearly doubled in one quarter to $23.9 billion (ended Feb. 26), with management stating they can only fulfill half to two-thirds of current demand. The company projects $33.5 billion in revenue next quarter as data centers expand and create a multi-year shortage of memory chips needed to power AI systems.

Broadcom designs custom AI chips (ASICs — specialized circuits built for specific tasks) instead of relying on Nvidia's general-purpose GPUs, and grew this business 106% year-over-year to $8.4 billion last quarter by supplying Alphabet's AI infrastructure. The company projects this business alone could reach $100 billion or more by 2027, exceeding Nvidia's overall growth trajectory.

Amazon quietly built custom AI training chips (Trainium) for its AWS cloud service, which reported its best quarter in three years with triple-digit growth in custom chip demand. Amazon's current and next-generation chips are already sold out 18 months in advance, showing enterprises prefer cheaper custom chips over renting Nvidia GPUs for AI workloads—a shift that could accelerate AWS revenue growth.