Applied Materials vs. Taiwan Semiconductor Manufacturing: Which Tech Stock Is a Better Buy in 2026?
Taiwan Semiconductor Manufacturing grew revenue 33%, while Applied Materials posted modest 4% growth -- a stark contrast in momentum.
Overview
As global demand for high-performance chips accelerates, investors face a choice between equipment providers and manufacturers. Deciding whether to buy Applied Materials (NASDAQ:AMAT) or Taiwan Semiconductor Manufacturing (NYSE:TSM) requires weighing growth against valuation.
Applied Materials provides the specialized machinery used to build chips, while Taiwan Semiconductor Manufacturing acts as the primary foundry for the world's most advanced chip designers. Both are essential pillars of the modern tech economy, but they occupy different stages of the supply chain. This comparison explores their financial health and risk profiles to help you choose the right fit.
Details
Applied Materials provides critical materials engineering solutions and manufacturing systems for the semiconductor industry and display markets. It serves a global client base, providing the specialized tools necessary for producing chips used in everything from smartphones to artificial intelligence. Customer concentration like this adds a layer of risk to the business, as two major customers accounted for nearly 19% and 15% of net revenue in fiscal 2025. The company also maintains a significant presence in China, Taiwan, and Korea, which makes the business sensitive to regional geopolitical developments and export regulations.
Source
Originally published at www.fool.com.
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