ON Semiconductor And 2 More AI Stocks To Watch

AI focused stocks have just been through a harsh reality check, with the recent tech sell off showing how quickly sentiment can flip when valuations and regulation collide. While pure software plays feel the heat, the physical side of automation looks very different. Robots still need to be built, shipped and maintained. This article walks through three robotics and automation stocks from our screener that channel that demand into disciplined, real world businesses.

The three robotics and automation stocks covered below are just a sample set from the screen, with the full results surfacing 7 more companies that carry equally compelling automation stories and very different ways of turning the physical AI shift into profits. To identify your own highest conviction ideas, head straight into the Robotics and Automation Stocks screener to filter and analyze the field of robotics leaders on your terms.

ON Semiconductor (ON)

ON Semiconductor plugs directly into the robotics theme through the chips that let machines see, sense and manage power, while still running a broader business that spans automotive, industrial automation and AI data centers.

ON Semiconductor generates about US$3.2b from its Power Solutions Group, US$2.2b from Analog and Mixed-Signal and US$950 million from Intelligent Sensing, which feeds robotics and factory automation, giving the US$24.5b company a diversified footing in automation hardware.

"ON Semiconductor's investments in silicon carbide, vertical GaN and the Embedded Power Platform are now tied to a much larger AI data center opportunity, with management lifting its 2030 server and AI data center market estimate from about US$12b to nearly US$50b and targeting AI data center revenue growth at least 10 percentage points faster than the market."

The real swing factor for ON Semiconductor is how one quiet shift in its product mix plays through into long term margins and cash generation.

That shift is exactly what sits at the heart of the full narrative for ON Semiconductor, which unpacks how product mix, capital discipline and AI exposure could be quietly decoupling here.

Allegro MicroSystems (ALGM)

Allegro MicroSystems leans into the robotics and physical AI theme through its magnetic sensors and motor driver chips that sit inside factory robots, autonomous mobile platforms and AI heavy industrial equipment, turning precise motion control into a scaled semiconductor business.

Allegro MicroSystems generates about US$1.0b from designing, developing, producing and distributing integrated circuits for sensing, motion control and power management, with these chips used across automotive and industrial customers worldwide, and the stock carries a roughly US$5.8b market value.

Robotics repeatedly needs precise motion and power control, and Allegro MicroSystems is trying to supply that through sensor ICs and motor drivers that plug directly into industrial automation and AI rich data center hardware.

"Industrial automation and data center markets are contributing more meaningfully to Allegro MicroSystems, with Industrial and Other sales of US$94 million in the latest quarter, data center reaching 17% of total sales and current sensors rising to 22% of data center revenue with gross margins in that business in the mid 50s."

What happens if one unseen pressure on Allegro MicroSystems’ robotics focused sensor and power portfolio shifts the trajectory of those margins?

If that pressure matters to you, read the full narrative for Allegro MicroSystems to see whether Allegro MicroSystems’ data center push is accelerating strength or quietly masking risk.

Arm Holdings (ARM)

Arm Holdings supplies the chip designs that sit inside everything from smartphones to embedded controllers, and that same CPU, GPU and NPU IP is what lets energy efficient processors run perception and control directly on robots and factory automation gear.

Arm generated about US$5.5b from semiconductor equipment and services and has a market value near US$178.4b.

For robotics and automation investors, Arm Holdings matters because its IP is one of the key ways physical AI moves from pilots into scaled, power efficient machines at the edge.

"The single most important catalyst is AGI CPU execution. If Arm ships successfully, secures enough supply, and converts early customer demand into real revenue, the stock can continue to command a premium."

What could really move the needle is how one pressure on Arm’s AI heavy royalty base shapes the durability of that demand curve.

That pressure on Arm’s AI heavy royalty stream is exactly what the full narrative for Arm Holdings unpacks, separating short term execution noise from where this story could be accelerating next.

Seeking Alternatives Before Everyone Else?

Fresh opportunities do not wait. While attention chases the last breakout, new momentum and cash rich ideas stay under the radar for now. Screen them before the crowd and consider them early.

• Spot strong balance sheets early by scanning the curated list of solid balance sheet and fundamentals (24 results) and avoid companies that may struggle when conditions tighten, while it still matters.
• Review structural trends by using 41 profitable AI stocks that aren't just burning cash where AI revenue aligns with actual earnings, not just stories, to help reduce the risk of focusing on hype late.
• Evaluate potential infrastructure-related ideas by screening 40 power grid technology and infrastructure stocks and identifying possible grid upgrade beneficiaries before those developments are fully reflected in expectations.

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