Investors have been captivated by the semiconductor sector, with SanDisk (NASDAQ: SNDK) rising over 700% in the last year due to strong global demand for data storage. A shift to AI inference is driving the need for local AI models, benefiting OEMs like SanDisk and positioning them for a catch-up trade.

SanDisk’s recent earnings report showed a 61% year-over-year revenue increase and a 51.1% gross margin expansion, signaling strong pricing power. This data indicates a hardware sector growth trend, driven by the demand for flash memory for Edge AI applications needing fast, local storage.

Dell Technologies (NYSE: DELL) serves as a stable growth play for AI exposure, with a record $18.4 billion backlog for AI servers. Dell’s AI Factory strategy is successful, providing high visibility and confirmed order flow in the commercial market for AI hardware infrastructure.

HP Inc. (NYSE: HPQ) presents a deep value opportunity, trading lower due to an executive change. HP’s Fiscal 2026 Plan aims to cut costs by $1 billion through operational efficiency, protecting profit margins amidst rising component costs. With a high dividend yield of approximately 6.5%, HP positions itself for the AI PC refresh cycle.

The AI in a Box trade signals the beginning of a hardware supercycle, with companies like SanDisk, Dell Technologies, and HP Inc. offering opportunities for investors. By focusing on companies building final devices for AI applications, investors can participate in the Edge Computing revolution at more reasonable valuations compared to the overheated semiconductor sector.

Read more at Nasdaq: The AI in a Box Trade: Hardware Is the Next Boom