Nvidia (NASDAQ: NVDA) has been on a remarkable run over the past year and a half. Not only is its stock up over 670% since the beginning of 2023, but its revenue in its most recent quarter (ended April 28) grew an impressive 262% year over year.

Nvidia has artificial intelligence (AI) mania to thank for its recent successes. It became the go-to option for its state-of-the-art graphic processing units ( GPUs ) that power many of the world's data centers (more on that to come). Both investors and tech customers have been flocking to Nvidia to take advantage of the newfound AI momentum.

That said, Nvidia's recent stock price growth made the stock absurdly expensive (66 P/E ratio ), leaving it more susceptible to a correction if it underdelivers in the slightest. That's why the following two stocks may be better options right now for investors interested in the tech sector.

1. Taiwan Semiconductor Manufacturing Company

Taiwan Semiconductor Manufacturing, (NYSE: TSM) also known as TSMC, is the largest semiconductor (chip) foundry in the world, powering many of the electronics we use in our daily lives. With TSMC's foundry model, it creates chips specifically for customers' needs instead of general sales. This gives it a much more personal relationship with many of its customers and increases its importance to the tech world.

TSMC chips are used in smartphones, car infotainment systems, gaming consoles, GPUs, and many other products. Given the importance of TSMC's chips in creating GPUs, there's arguably no company as vital to Nvidia as TSMC. Nvidia's ability to meet the surge in demand for its GPUs largely depends on TSMC's manufacturing capacity.

Without these chips, GPU quality likely suffers, which then bleeds over into data centers and, ultimately, many of the AI applications and services consumers interact with. So far, though, this reliance hasn't posed a problem for TSMC. In the second quarter, it made $20.8 billion in revenue, up 33% from a year ago.

TSMC's high-power computing (HPC) segment, which includes AI-related chips, generated 52% of the revenue, up from 46% in the first quarter. It expects revenue from AI-related chips to grow at a 50% compound annual growth rate over the next five years, which would make it around 20% of TSMC's total revenue.

Although TSMC's stock is up close to 60% this year, it dropped by over 6% in the past month, giving investors a more attractive price to consider. With a price-to-earnings ratio close to 29, the stock isn't cheap, but the company's importance can make it justifiable for long-term investors.

2. Microsoft

Microsoft (NASDAQ: MSFT) stock had an impressive year, but the past month has been a bit brutal. The stock is down by over 9% since early July, bumping it down to the world's second-most valuable company after spending the better part of the last year up top.

Microsoft was seemingly ahead of the game when it first began its partnership with ChatGPT's creator, OpenAI, back in 2019 with a $1 billion investment. It has since expanded its partnership with OpenAI and both parties seem to be playing an equal part in the deal.

OpenAI gets to use Microsoft's cloud service, Azure, for its infrastructure and supercomputing power. In return, Microsoft gets to integrate OpenAI's AI technologies into its large suite of products and services. It's a move that makes perfect sense for Microsoft, considering the money, personnel, and time it would take to build these capabilities in-house.

Microsoft is arguably the most well-diversified big tech company, with its hands in seemingly all things enterprise. It's the go-to for many products and services for businesses globally, which has helped it ensure its longevity as a tech titan. Nvidia, on the other hand, will rely heavily on GPUs, making its business and continued growth reliant on AI adaption (which has yet to be seen in the long term).

Microsoft's all-but-ensured longevity makes it easier to justify its high 36.8 P/E ratio if you're in it for the long haul. That's expensive by most standards, but dollar-cost averaging your way into a stake could pay off well down the road.

Before you buy stock in Taiwan Semiconductor Manufacturing, consider this: