Chip stocks gained sharply on Monday, lifted by renewed optimism in the AI sector. The rally came after Nvidia (NVDA) CEO Jensen Huang, speaking in Taiwan over the weekend, said demand for the company’s new Blackwell AI chips remains “very strong.” Reports that Huang asked Taiwan Semiconductor Manufacturing Company (TSM) to boost chip output added to the excitement and lifted hopes for strong results when Nvidia reports earnings next week.
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Micron, AMD, and Palantir Lead Sector Gains
The upbeat tone spread quickly across chip stocks. Micron Technology (MU) rose more than 6% on signs that memory prices are improving, helped by tighter supply and steady demand for high-bandwidth memory (HBM). Advanced Micro Devices (AMD) gained over 4% as traders bet that strong AI demand could lift sales of its new MI300 chips.
Other AI-related names also joined the rally. Palantir Technologies (PLTR), Western Digital (WDC), and Seagate Technology (STX) all traded higher, driven by growing confidence in AI spending and data demand.
Focus Turns to Nvidia’s Upcoming Earnings Now
Investors are now watching closely as Nvidia prepares to report its third quarter of Fiscal 2026 next week. Wall Street projects earnings per share (EPS) of $1.25, up 54% year-over-year, with revenue expected to grow 56% to $54.6 billion.
Analysts expect another strong quarter driven by high demand for Blackwell and H100 chips used in AI servers. Wedbush analyst Dan Ives called last week’s pullback in tech stocks a “short-lived dip” and said Nvidia’s results could be a key test for the AI market. He believes steady AI spending will keep chip demand strong through 2025.
Huang’s recent comments from Taiwan also helped ease worries about production delays, showing that Nvidia remains confident in meeting demand from its cloud and AI customers.
Which Stock Is the Best Buy?
Turning to Wall Street, among the stocks mentioned above, Nvidia offers the highest upside at about 19%, with analysts maintaining a Strong Buy rating. AMD follows with roughly 14% upside and a Moderate Buy consensus rating.
Micron and Western Digital also hold Strong Buy ratings, while Seagate is rated Moderate Buy. Meanwhile, Palantir is the only stock with a Hold rating, as analysts stay cautious after its recent rally.
