AMD backs $300 million loan for Crusoe using AI chips as debt collateral, mimicking Nvidia

AMD's AI chips to be used as debt collateral in $300 million loan, report says -- Cloud startup to use chips in Ohio datacenter

AMD is following in the type of circular deals Nvidia has been making to get chips into startups' hands. AMD's AI chips will be used as debt collateral in a deal to financially support a cloud startup buying the company's processors, The Information reports. It's the first known occurrence of the practice with AMD's chips, creating a circular deal similar to those that Nvidia has been making to increase GPU sales. The $300 million loan from Goldman Sachs to the cloud startup Crusoe will be used to buy AMD's AI chips (the reporting doesn't specify which chip will be used, though presumably it will be a member of the Instinct MI450 series). Those chips will be used in a datacenter in Ohio. AMD is set to effectively serve as guarantor for the deal, according to the report, by agreeing to rent the chips from Crusoe if the company can't find other willing customers, sources close to the deal told The Information. In the meantime, AMD will get to say it has $300 million in AI chip sales. Crusoe is a cloud startup that claims to build data centers with cleaner energy than other companies, with more due diligence on "sites with clean, scalable power already in place." This is far from AMD's first major AI deal. Last year, OpenAI secured up to 6 gigawatts of AMD GPU compute in a deal that could see the ChatGPT creator take a significant stake in AMD. In December, AMD and HPE entered into an agreement that will bring the AMD Helios rack-scale AI architecture into HPE's product portfolio. AMD is following Nvidia in using chips as collateral. Nvidia famously put up H100 GPUs as collateral to back CoreWeave's $2.3 billion loan by Magnetar Capital and Blackstone. These circular deals let the companies make big claims about how many chips they've sold and where they're deployed without startups seeing much of the actual risk. AMD has denied reports that its next-generation MI455X accelerators may be delayed in production. Those are set for the second half of 2026. We've reached out to AMD for comment. Follow Tom's Hardware on Google News, or add us as a preferred source, to get our latest news, analysis, & reviews in your feeds.

AMD Backs $300 Million Loan For Crusoe's AI Chip Deployment, Mimicking Nvidia's Strategy: Report - Advanced Micro Devices (NASDAQ:AMD), CoreWeave (NASDAQ:CRWV)

Advanced Micro Devices (NASDAQ:AMD) has reportedly agreed to guarantee a $300 million loan for cloud computing startup Crusoe. AMD has proposed a deal to buy back its chips from Crusoe if the startup is unable to attract customers like AI developers. The arrangement, backed by a loan from Goldman Sachs (NYSE:GS), will be collateralized with the chips and associated equipment, The Information reported on Thursday. With AMD acting as a backstop, Crusoe has locked in a loan interest rate of around 6%, substantially below what it would have otherwise achieved. The company is now installing AMD chips in an Ohio data center being built by 5C, a Canadian developer supported by Brookfield. Crusoe, launched in 2018 as a cryptocurrency company, has pivoted to AI infrastructure and is part of the emerging "neoclouds" offering specialized cloud and data-center services for AI companies. AMD and Crusoe did not immediately respond to Benzinga's request for comment. AMD Steps Up To Challenge Nvidia AMD has been making strategic moves to compete with Nvidia. Earlier this week, AMD expanded its work with India's Tata Consultancy Services to roll out its newest AI data center design, aiming to take share from Nvidia in a rapidly scaling market. In Q4, AMD posted a record $10.3 billion in revenue, up 34% year-over-year, driven by its Data Center segment, which hit $5.4 billion. Management expects this segment to grow over 60% annually over the next three to five years. According to Benzinga Edge Stock Rankings, AMD has a momentum score of 88.93% and a quality rating of 92.81%. Benzinga's screener allows you to compare AMD's performance with its peers. NFLX Price Action: AMD shares declined 8.99% on a year-to-date basis, according to Benzinga Pro data. On Thursday, it closed 1.62% higher at $203.37. Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Image via Shutterstock Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.