Broadcom reported a staggering 220% surge in AI revenue to $12.2 billion in Q4 2024, reflecting strong demand for its products in the AI sector.

TSMC dominates the advanced processor manufacturing market, holding an estimated 90% share, and manufactures chips for major companies like Nvidia, AMD, and Amazon.

Broadcom's CEO estimates the company's addressable AI market could reach between $60 billion and $90 billion by 2027, highlighting the growth potential in this area.

Taiwan Semiconductor Manufacturing Company (TSMC) is poised to be the best semiconductor investment for the next decade, given its critical role in AI development.

With major tech companies such as Microsoft, Amazon, and Alphabet expected to increase their capital expenditures on AI infrastructure, TSMC's earnings growth is set to accelerate.

Nvidia's upcoming Blackwell GPU infrastructure is sold out for the next year, with a successor GPU, Rubin, expected to launch in 2026, while AMD is also preparing to release new GPUs.

Trading at a forward price-to-earnings (P/E) ratio of 23, TSMC stands out as an affordable investment option among semiconductor stocks.

Goldman Sachs predicts that generative AI spending may reach $1 trillion in the coming years, which would benefit companies like Broadcom and TSMC.

In its latest financial report, TSMC showcased robust performance with a 39% sales increase to $23.5 billion and a 54% rise in earnings to $1.94 per ADR.

Despite a remarkable 107% increase in TSMC's stock over the past year, its P/E ratio remains comparable to the S&P 500 average, indicating potential for further growth.

Nvidia anticipates that AI data center spending could double to $2 trillion in the next five years, which is likely to significantly benefit TSMC.

Since the launch of ChatGPT in late November 2022, the Nasdaq Composite and S&P 500 indexes have seen impressive returns of 70% and 47%, respectively.