AMAT and Micron still winning in AI trade despite QQQ and sector weakness

In a choppy market where the AI trade has broadly struggled, one voice cutting through the noise put it simply: “Certain stocks have done well in the AI trade like AMAT, like Micron.” That’s not a hot take. It’s backed by the numbers.

While SPDR S&P 500 ETF Trust (NYSEARCA:SPY) is essentially flat year-to-date, down just 0.7%, and Invesco QQQ Trust (NASDAQ:QQQ) has slipped about 1% on the year, two semiconductor names have been quietly dominating.

AMAT: The Picks-and-Shovels Play on AI Memory

Applied Materials (NASDAQ:AMAT) is up nearly 35% year-to-date, trading around $345.88. Applied makes the machines that build the chips. If AI is a gold rush, Applied makes the shovels, and demand for those shovels is accelerating.

In its most recent quarter, Applied delivered non-GAAP EPS of $2.38 against a $2.21 estimate, a nearly 8% beat. Revenue came in at $7.01 billion. DRAM revenue hit a record, now representing 34% of the Semiconductor Systems segment, up from 27% a year ago. That’s AI memory buildout in action.

CEO Gary Dickerson was direct on the outlook:

“The need for higher performance and more energy-efficient chips is driving high growth rates for leading-edge logic, high-bandwidth memory and advanced packaging. These are areas where Applied is the process equipment leader, and we expect to grow our semiconductor equipment business over 20 percent this calendar year.”

That’s a direct commitment to 20%+ growth in calendar 2026. The analyst community is listening: Morgan Stanley named Applied its top pick in U.S. semiconductor equipment, raising its price target to $432.

Micron: The AI Memory Supercycle Is Real

Micron Technology (NASDAQ:MU) is up 41% year-to-date, trading near $403. Last quarter, Micron posted non-GAAP EPS of $4.78 against a $3.94 estimate, a 21% beat. Revenue surged 56.6% year-over-year to $13.64 billion. GAAP gross margins expanded from 38.4% to 56.0% in a single year.

The Cloud Memory Business Unit alone generated $5.28 billion in revenue at a 66% gross margin. That’s not a cyclical memory company. That’s a high-margin AI infrastructure business.

CEO Sanjay Mehrotra called it plainly: “Micron’s technology leadership, differentiated product portfolio, and strong operational execution position us as an essential AI enabler.” HBM order books are already extending into 2027.

The Bigger Picture: Stay Selective

Defensive names like Procter & Gamble (NYSE:PG), Coca-Cola (NYSE:KO), and Walmart (NYSE:WMT | WMT Price Prediction) are all up on the year but have pulled back over the past month. The VIX spiked as high as 29.49 on March 6 before settling near 25.50. Elevated, but not panic territory.

The message is straightforward: the broader market is only off about 3% from recent highs despite the noise. The AI infrastructure trade is alive; it’s just become a stock picker’s game, and right now Applied Materials and Micron are doing the heavy lifting.