Apple and Taiwan Semiconductor Manufacturing Just Announced a Cutting-Edge Chip. 1 Stock Offers Far Greater Upside.

AAPL and TSM unveiled the A20 Pro chip built on 2-nanometer process technology, but an analyst sees TSM as the stronger play. TSM is expected to post 43% revenue growth in 2026, driven by AI infrastructure demand, compared to AAPL's projected 15% growth over the same period. The analyst notes AAPL has lagged competitors in AI development, constraining its upside.

Despite the growth gap, TSM trades at a lower valuation multiple than AAPL, creating a valuation-growth mismatch that favors the chipmaker. The 2nm A20 Pro partnership underscores TSM's manufacturing leadership, but the foundry's exposure to the broader AI buildout—not just one customer—drives the bullish thesis.

TSM's position as the sole supplier of leading-edge nodes for multiple hyperscalers and chip designers gives it leverage across the AI supply chain. AAPL, meanwhile, faces intensifying competition in consumer devices and questions about its AI roadmap execution.