Better Semiconductor Stock During the Crash: Nvidia or AMD?
Key Points
Nvidia grew its revenue more than AMD over the last year.
However, AMD is doing well financially and has increased its CPU market share.
- 10 stocks we like better than Nvidia ›
No semiconductor company has been as successful as Nvidia (NASDAQ: NVDA) over the past three years or so, but recently, Advanced Micro Devices (NASDAQ: AMD) has been the better investment. AMD stock is trading up 88% over the last year, as of March 20. Nvidia trails it with a still-impressive return of 46%.
After the recent market turmoil, both of these semiconductor stocks are cheaper than they were at the start of the year. But which one is the better buy?
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Nvidia is still the winner in terms of sales growth, with $68.1 billion in revenue during the fourth quarter of its 2026 fiscal year, which ended Jan. 25, 2026. That was a 70% year-over-year increase. AMD's revenue increased 34% to $10.3 billion in the fourth quarter of its 2025 fiscal year, which ended Dec. 27, 2025. Nvidia also has better gross margins at 75% compared to 54% for AMD, due to Nvidia's dominance over the GPU market and its widely used CUDA software ecosystem.
That said, there are also reasons to be bullish about AMD. While Nvidia focuses more on GPUs, AMD has a growing share of the CPU market -- up to 29.2% as of Q4 2025. It has announced strategic partnerships with OpenAI and Meta Platforms in the last six months, and it has a price/earnings-to-growth (PEG) ratio under 0.5 over the trailing 12 months, even lower than Nvidia.
PEG ratio is a way to value a stock based on its earnings growth, and lower is better, with anything under 1 normally considered undervalued.
If you could only invest in one of these tech stocks, Nvidia would still be my recommendation, based on its incredible revenue growth and GPU market share. But there's nothing precluding you from buying both, and that's the better option if you want to capitalize on each company's success.
Should you buy stock in Nvidia right now?
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Lyle Daly has positions in Meta Platforms and Nvidia. The Motley Fool has positions in and recommends Advanced Micro Devices, Meta Platforms, and Nvidia. The Motley Fool has a disclosure policy.
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