ON Semiconductor And 2 More AI Robotics Stocks To Watch

Rising government bond yields near 5% are lifting borrowing costs at the exact moment companies want to spend heavily on automation and physical AI. That squeeze makes efficient robotics a potential pressure valve for margins and capacity. Investors watching this shift may not want to sit on the sidelines. This article walks through three robotics focused stocks from our screener that are positioned to monetise this automation push.

The three stocks below are a small sample, and the full robotics screen surfaced 33 more businesses with equally compelling automation stories and capital discipline that are not covered in this article.

Head straight into the Robotics and Automation Stocks screener to identify, compare, and analyze the highest conviction robotics and automation opportunities that best fit your portfolio.

ON Semiconductor (ON)

Overview: ON Semiconductor supplies intelligent power and imaging chips that give industrial robots, factory lines, and AI systems eyes and energy control.

Operations: ON Semiconductor generates about US$3b from Power Solutions, US$2.2b from Analog & Mixed-Signal, and US$944.7 million from Intelligent Sensing.

Market Cap: US$28.96b

ON Semiconductor matters for this robotics screen because its imaging sensors sit inside the cameras and perception systems that allow industrial machines to see, measure, and react in real time.

"Ongoing portfolio rationalization, including the phasing out of legacy and non-core products and the reallocation of resources towards higher-margin, differentiated offerings (such as ADAS image sensing and machine vision), should improve product mix and boost average margins, positively impacting net profitability and earnings leverage."

What happens to those margin ambitions depends heavily on how one less visible capacity and utilization pressure resolves over the next few years.

That hinge point on capacity is exactly what the full narrative for ON Semiconductor unpacks, revealing how ON Semiconductor's automation exposure could accelerate or stall as customers ramp up AI-heavy capital expenditures.

Arm Holdings (ARM)

Overview: Arm Holdings licenses CPU, GPU, and NPU designs that power low power compute inside robots, industrial automation gear, and edge AI devices worldwide.

Operations: Arm generates US$5.16b from Semiconductor Equipment and Services, with material exposure to the United States, Japan, Taiwan, China, and Korea.

Market Cap: US$269.25b

Arm Holdings matters for this robotics and automation screen because its chip designs sit inside the brains of industrial robots and connected machines, turning physical AI from a concept into something factories and warehouses can actually deploy at scale.

"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 that premium ultimately rests on may come down to how one quiet supply and capacity bottleneck plays out just as robotics demand ramps.

That bottleneck is exactly what the full narrative for Arm Holdings lays out. It shows where Arm Holdings could accelerate, where it might stall, and what that means for physical AI demand.

Teradyne (TER)

Overview: Teradyne builds automated semiconductor test systems and robotics, with collaborative arms and mobile robots giving factories and warehouses practical physical AI.

Operations: Teradyne generates about US$3.7b from Semiconductor Test, US$386 million from Product Test, and US$356 million from Robotics.

Market Cap: US$55.82b

Teradyne matters for this robotics and automation screen because its Universal Robots and MiR platforms put flexible robots directly into production lines and warehouses, right where labor gaps and inflation are biting hardest.

"Teradyne expects significant future growth potential from AI accelerators, robotics, and semiconductor automation, which are being driven by long-term industry themes such as AI, verticalization, and electrification."

What investors really need to watch now is how one emerging constraint shapes the balance between robotics demand, pricing power, and future margin headroom.

As that constraint unfolds, the full narrative for Teradyne maps where Teradyne’s robotics momentum could accelerate, decouple from chip cycles and quietly reset expectations for physical AI.

Seeking Alternatives Before Others Catch On

Fresh themes move first. Once momentum breaks out and capital flies in, the easy entries are gone. Scan these under the radar ideas while it matters and aim to establish a position early.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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