AMD Secures Landmark Multi-Year AI Chip Deal with OpenAI, Shares Surge
AMD secured a multi-year deal to supply AI chips to OpenAI, deploying hundreds of thousands of GPUs from 2026. OpenAI also gained a 10% equity option.
Overview
- AMD and OpenAI have forged a multi-year partnership for AI chip supply, with OpenAI exclusively utilizing AMD's high-performance GPUs for its advanced AI infrastructure needs.
- The deal involves deploying hundreds of thousands of AMD AI graphics processing units over several years, with implementation scheduled to commence in the second half of 2026.
- This significant agreement is projected to generate tens of billions of dollars in annual revenue for AMD, contributing to over $100 billion in new revenue over four years.
- As part of the strategic alliance, OpenAI has been granted an option to purchase 160 million shares at 1 cent each, securing a 10% equity stake in AMD.
- Following the announcement, AMD's shares surged over 30%, reflecting strong investor confidence in the deal's transformative potential for AMD and the broader AI industry.
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Analysis
Center-leaning sources cover the AMD-OpenAI chip deal neutrally, focusing on factual reporting. They detail the agreement's terms, including compute capacity and stock options, and provide market context without loaded language or biased emphasis. This approach ensures readers receive a balanced overview of the significant partnership and its implications for the AI industry.
"The deal marks a major endorsement of AMD's AI hardware and software capabilities as the company competes with Nvidia for dominance in the AI chip market."
ARS Technica"The financials of the deal were not disclosed, but AMD chief financial officer Jean Hu said in the press release that the partnership was “expected to deliver tens of billions of dollars in revenue for AMD while accelerating OpenAI’s AI infrastructure buildout.”"
Gizmodo"This partnership brings the best of AMD and OpenAI together to create a true win-win enabling the world’s most ambitious AI buildout and advancing the entire AI ecosystem."
TechCrunch"The deal offers OpenAI an opportunity to take a stake in one of Nvidia’s most formidable rivals and is a powerful endorsement of Advanced Micro Devices’ (AMD‘s) AI chips and software."
NBC News"This partnership is a major step in building the compute capacity needed to realize AI’s full potential."
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FAQ
The deal involves OpenAI deploying a total of 6 gigawatts of AMD Instinct GPUs over multiple generations starting in the second half of 2026, with an initial deployment of 1 gigawatt using AMD Instinct MI450 series GPUs.
This agreement is expected to generate tens of billions of dollars in annual revenue for AMD, potentially contributing over $100 billion in new revenue over four years.
OpenAI has been granted an option to purchase 160 million shares of AMD common stock at 1 cent each, which would give them approximately a 10% equity stake in AMD, with vesting based on technical and commercial milestones.
The initial deployment of 1 gigawatt of AMD Instinct MI450 GPUs is scheduled to start in the second half of 2026.
The partnership strengthens AMD's position as a core strategic compute partner for large-scale AI infrastructure and aims to challenge NVIDIA's dominance, fueled by the large-scale deployment of AMD GPUs and collaboration on future generations of AI hardware.
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