Semiconductor stocks have outperformed the broader market in 2023 thanks to the booming demand for chips deployed in artificial intelligence (AI) applications, which explains why the PHLX Semiconductor Sector index's gains of 45% this year are well ahead of the 17% appreciation in the S 500 index.

Not surprisingly, PHLX Semiconductor Sector index constituents Nvidia (NASDAQ: NVDA) and (NASDAQ: INTC) also clocked solid gains. While Nvidia stock is up a massive 232% in 2023, Intel delivered relatively smaller gains of 38%.

Nvidia's terrific surge is a result of the pioneering role the company is playing in AI. Intel, meanwhile, is struggling on account of weak personal computer (PC) and data center sales, though it is trying to cut its teeth in the AI chip market. But can Intel really make a dent in Nvidia's AI supremacy and give investors a cheaper -- and better -- way to play the AI revolution? Let's find out.

Continue reading

Source Fool.com