This Chip Stock Could Be a Top Performer by 2027

When investors look at investing in computer chips to take advantage of the artificial intelligence (AI) revolution, they are likely to start with a company like Nvidia (NASDAQ: NVDA). That makes sense, given that it makes the most popular chips for handling AI workloads. However, there’s another chip stock that could also turn out to be a huge AI winner: Texas Instruments (NASDAQ: TXN).

Nvidia makes high-powered parallel processing chips that act as the primary brains that undergird AI software. Texas Instruments makes analog chips, the boring ones that convert physical events into digital signals. When you push a button on a digital device, it is likely being controlled by an analog chip. Texas Instruments’ chips are simple, relatively low cost, and can be found in tech products virtually everywhere.

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In the artificial intelligence hardware world, Texas Instruments’ chips provide power management. That’s a vital function within the data centers that house AI. Given the expectation that the AI infrastructure buildout is only just beginning, Texas Instruments could have years of growth ahead of it in this end market.

Over the last few years, the analog chip sector has been in a rut. However, Texas Instruments has been investing in new chip production capacity. Just recently, it agreed to buy competitor Silicon Labs (NASDAQ: SLAB). In other words, Texas Instruments is preparing for growth.

It is also shifting the way it reports its sales. In the fourth quarter of 2025, the company broke out its data center business as a separate end market. The segment accounted for around 9% of the top line. However, it grew 64% year over year in the fourth quarter.

That’s probably not a number to bake into your growth expectations, given that the AI opportunity is brand new. Still, revenue rose by a mid-single-digit percentage from the third quarter. If this is just the beginning of the AI buildout, this segment could help supercharge an upturn in the typically cyclical analog chip sector and support growth for years to come.

There are other analog chipmakers, and there are chipmakers that make more exciting chips than Texas Instruments. However, for most investors, opening a position in this industry-leading company will probably set you up for long-term success. And given the strength of the business and the company’s growth efforts, the AI buildout could easily turn Texas Instruments into a top-performing chipmaker by 2027, if not sooner.

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Reuben Gregg Brewer has positions in Texas Instruments. The Motley Fool has positions in and recommends Nvidia and Texas Instruments. The Motley Fool has a disclosure policy.

Prediction: This Chip Stock Could Be a Top Performer by 2027 was originally published by The Motley Fool