SpaceX’s initial public offering (IPO) will finally take place next week, and the market is brimming with excitement. The potential of space exploration is truly astonishing, and investors are eager to claim a share of it.
However, a deeper analysis reveals that SpaceX may not be the best choice for most investors at present. The company is still operating at a loss, and its stock is likely to be very expensive once listed. Consider keeping SpaceX on your watchlist—given that it will likely dominate media coverage in the coming years, this should not be difficult. But if you are looking to buy a quality tech stock right now, Alphabet (GOOG) (GOOGL) and TSMC (TSM) are worth considering.
Alphabet is best known for its Google search engine, which holds a massive lead in the industry, commanding 90% of search traffic. This economic moat is nearly insurmountable, at least in the short term. Supported by Gemini, the company recently launched AI-generated summaries and an AI mode, smartly sidestepping potential threats from new large language models.
What makes Alphabet even more attractive is its diversified revenue streams. Not only does it top the global search engine market, but it also owns a range of leading businesses, including YouTube and Android. These diverse operations provide multiple sources of revenue and help shield the company from downside risks in any single sector.
Its performance speaks for itself. In the first quarter of fiscal 2026, the company’s revenue maintained double-digit growth, increasing 22% year over year, with cloud revenue growing 63%. Operating margin expanded by a full two percentage points to 36.1%, and net profit rose 81%.
Another positive development is that Warren Buffett built a stake in Alphabet before stepping down as CEO of Berkshire Hathaway earlier this year, and current leader Greg Abel has just tripled that holding.
TSMC is the world’s largest semiconductor foundry, partnering with most global chip design companies, including NVIDIA and Apple. The company has recently expanded into the United States, opening the first of several facilities in Arizona, and is ramping up investment to meet surging demand.
TSMC’s appeal lies in its ability to benefit from whatever technology is in vogue. The current hot topic is AI, and the high-performance computing segment is driving growth. However, the company is also involved in smartphones, automotive, and other smaller sectors. If technological trends shift—whether toward new forms of AI or elsewhere—the company manufacturing the chips will still likely continue partnering with TSMC.
Another standout feature is TSMC’s exceptional profitability for a non-service company. In the first quarter of fiscal 2026, revenue grew 41% year over year, gross margin expanded 7.4 percentage points to 66.2%, and operating margin expanded 9.6 percentage points to 58.1%.
TSMC offers investors exposure to the AI space while reducing the risks associated with being a pure-play AI company, and it boasts excellent long-term prospects.
Although SpaceX’s IPO has captured significant attention, its losses and high valuation risks cannot be ignored. In contrast, Alphabet, with its monopoly position in search engines, diversified business portfolio, and solid financial performance, demonstrates stronger defensiveness and growth potential. Meanwhile, TSMC, as the global leader in semiconductor foundry services, is able to navigate different technology cycles, benefit from various tech trends including AI, and maintain extremely high profitability. For investors seeking more certain opportunities in the technology sector, these two stocks may be more suitable than SpaceX at the current time.
