AI & Chips: A Sensible Approach

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Polymarket, it seems, is the latest place to gamble on the future. You can place bets on elections, the weather, geopolitical kerfuffles – anything, really, if it can be reduced to a simple ‘yes’ or ‘no’. Nearly half a million people are apparently at it, which is…remarkable. It’s a bit like those old penny dreadfuls, really, only with slightly more complicated odds. Now, I’m not saying it isn’t diverting, but unless you happen to possess a preternatural gift for prognostication (and let’s be honest, most of us struggle to predict what we’ll have for dinner), you’re probably better off putting your money somewhere a little less… capricious. I’d rather invest in things that actually make the future happen, specifically two companies quietly powering the artificial intelligence revolution: TSMC and Nebius Group.

TSMC: The Unsung Hero of Modern Life

TSMC, or Taiwan Semiconductor Manufacturing Company, is a name most people won’t recognize, yet it’s absolutely fundamental to, well, pretty much everything electronic. They don’t make phones or computers; they make the chips that go inside them. And not just any chips, but the most advanced, smallest, most power-efficient chips in the world. It’s a bit like the people who make the gears for a clock – you don’t see them, but without them, the whole thing just…doesn’t tick. Companies like Nvidia, AMD, and even Apple rely on TSMC to fabricate their designs. It’s a remarkably powerful position to be in.

TSMC got ahead by being first to adopt some seriously complicated machinery – specifically, extreme ultraviolet (EUV) lithography systems made by a Dutch company called ASML. These machines are, frankly, astonishing. They use lasers to etch unbelievably tiny patterns onto silicon wafers, and they cost something in the neighborhood of $150 million apiece. It’s a bit like building a cathedral, only with more lasers and fewer gargoyles. They’re now ramping up production of 2nm chips – that’s two billionths of a meter – which is frankly mind-boggling. In 2025, their revenue surged 36%, largely driven by demand for chips used in AI data centers. And the best part? At 22 times earnings, the stock still seems reasonably priced. It’s a foundational play, and likely to remain so for quite some time.

Nebius: From Russia with Algorithms

Now, Nebius is a slightly more complicated story. It used to be Yandex, Russia’s leading search engine, a company that built a substantial business in a surprisingly short time. Then, in 2022, everything changed. Sanctions forced a restructuring, a relocation to the Netherlands, and a rebranding. It’s a bit like watching a chameleon change color, only with more paperwork and international lawyers. They’ve emerged as Nebius, a provider of cloud-based AI infrastructure. Essentially, they build and operate data centers full of powerful computers and rent out the computing power to companies that need it.

They’re focusing on providing the “muscle” for AI – the servers and infrastructure needed to train and run complex algorithms. They’ve seen phenomenal growth. Revenue jumped 462% in 2024, and another 351% in 2025, reaching $530 million. They’re not profitable yet – they’re still investing heavily in infrastructure – but analysts expect them to turn a profit soon, and for earnings to quadruple by 2027. With deals in place with giants like Microsoft and Meta Platforms, and an enterprise value of $38.4 billion, the stock, at 28 times adjusted EBITDA, still looks surprisingly undervalued.

A Sensible Approach to the AI Boom

Investing in Polymarket might be a bit like a lottery ticket – fun, perhaps, but hardly a sound financial strategy. TSMC and Nebius, on the other hand, are building the foundations of the AI revolution. They’re not glamorous, but they’re essential. If you’re a cautious investor, TSMC is the safer bet. If you’re looking for more growth potential, Nebius is worth a closer look. Either way, it’s a far more sensible approach than gambling on the future. And frankly, in the long run, that’s what investing should be all about.

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2026-02-25 20:53