Nvidia's stock may face consequences if the company fails to meet expectations. Nvidia, an AI leader, recently surpassed Microsoft to become the world's most valuable company, with a valuation exceeding $3 trillion. This success has resulted from the skyrocketing sales of its AI chips, providing incredible gains for investors. However, there is a real possibility that Nvidia's stock has entered the realm of a full-blown bubble. With a stock trading at around 40 times sales, well beyond its peak valuation during the dot-com bubble, Nvidia's ability to sustain extraordinary growth rates and high profit margins amidst fierce competition is crucial to justify its current price. Due to the high-risk nature of Nvidia's overvalued stock, investors seeking safer AI investments may consider Intel and Qualcomm. Intel offers its own AI accelerators, including the powerful Gaudi 3, while also aiming to capitalize on the semiconductor foundry market.

By becoming a major foundry player, Intel could manufacture AI chips for other companies, positioning itself for long-term success. Intel has already secured over $15 billion in foundry business, including a deal with Microsoft to manufacture a chip on its Intel 18A process. Qualcomm, on the other hand, leads the smartphone-chip market and has now entered the PC market with its Arm-based CPUs. These CPUs come with built-in AI capabilities, offering consumers AI-powered features in Windows and other software. While Arm-based PCs are expected to capture over 50% of the Windows PC market in the next five years, Qualcomm's early entry in this market gives it an advantage to establish itself and gain consumer confidence with its powerful Snapdragon chips. Although Nvidia has been the prominent AI winner thus far, investors should be cautious as the stock's performance heavily relies on meeting extreme expectations. Intel and Qualcomm provide alternative options for investment in AI with a lower risk profile.