OpenAI and AMD Forge Multibillion-Dollar AI Chip Partnership, Challenging Nvidia's Dominance

AMD teams up with OpenAI to challenge Nvidia's AI chip dominance

AMD is partnering with OpenAI to provide six gigawatts worth of processors for AI data centers, a move that challenges Nvidia's AI chip market dominance. The five-year agreement aims to help OpenAI bolster its infrastructure to meet growing computational demands for AI applications like ChatGPT, starting with a gigawatt deployment of AMD Instinct MI450 GPUs in the second half of 2026, according to AMD's press release. The financials of the deal have not been disclosed, but AMD said it expects the agreement to deliver "tens of billions of dollars in revenue" for the company. "We are thrilled to partner with OpenAI to deliver AI compute at massive scale," AMD CEO Lisa Su said in the announcement. "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."

OpenAI and AMD announce multibillion-dollar partnership -- AMD to supply 6 gigawatts in chips, OpenAI could get up to 10% of AMD shares in return

OpenAI and AMD have announced a multibillion-dollar partnership that will see the companies collaborate on AI data centers powered by AMD processors. OpenAI has committed to purchasing 6 gigawatts of AMD chips, starting with the MI450 next year. That will be done either by purchasing the chips directly from AMD or through cloud computing partners. AMD CEO Lisa Su told the WSJ that the deal would generate tens of billions of dollars in revenue for AMD over the next five years. The two companies are not disclosing the exact financial details of the deals. However, AMD emphasized that each "per gigawatt" of capacity is worth tens of billions of dollars, so it's possible the deal is worth upwards of $60 billion. In return, OpenAI will receive warrants for up to 160 million AMD shares, approximately 10% of AMD, at a price of $0.01 per share, to be awarded in phases, provided that OpenAI meets deployment milestones. The warrants will only be exercised if AMD's share price increases, although again, the specifics are unclear. The deal is an enormous win for AMD and stands juxtaposed with Nvidia's groundbreaking Intel partnership announced last month. Under the terms of that deal, Nvidia and Intel are jointly developing Intel x86 RTX SOCs for PCs featuring Nvidia graphics, as well as custom Nvidia data center x86 processors. Nvidia also received $5 billion in Intel stock as part of the deal. OpenAI will use AMD's chip for inference in order to cope with skyrocketing demand. "It's hard to overstate how difficult it's become... We want it super fast, but it takes some time." OpenAI's Sam Altman said to WSJ. "We are thrilled to partner with OpenAI to deliver AI compute at massive scale," said Dr. Lisa Su, chair and CEO, AMD. "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." The first deployment will be 1 gigawatt worth of MI450 chips, scheduled for the second half of 2026. Altman said the AI buildout has reached a phase "where the entire industry's got to come together and everybody's going to do super well," not only on chips and data centers, but also further down the supply chain too. OpenAI has also inked a $100 billion deal with OpenAI, and will use Nvidia's investment to secure and deploy 10 gigawatts worth of AI data centers. While that deal isn't finalized, AMD and OpenAI reportedly say this deal is "definitive" and plan to immediately file the requisite details with regulators, a step that has yet to happen in the Nvidia deal.

OpenAI Inks AMD Chips Deal Worth Tens of Billions of Dollars

Advanced Micro Devices Inc. inked a deal with OpenAI to roll out AI infrastructure in a pact the chipmaker said could generate tens of billions of dollars in new revenue. AMD's shares soared. The two signed a definitive agreement for OpenAI to deploy 6 gigawatts of AMD GPUs over multiple years, the companies said Monday in a statement. AMD has given OpenAI a warrant for up to 160 million shares, which will vest as milestones are achieved. Those targets require AMD's stock price to continue to increase in value and future exercise points include a tranche tied to a share price of $600. AMD shares closed Friday at $164.67.

OpenAI targets 10% AMD stake via multibillion-dollar chip deal

OpenAI has agreed to buy tens of billions of dollars' worth of chips from AMD as part of a deal that could also see the ChatGPT maker take a roughly 10 per cent stake in the $270bn chipmaker over time. The San Francisco-based artificial intelligence start-up said on Monday it had agreed to purchase processors with a total power consumption of 6 gigawatts, roughly equivalent to Singapore's average demand. The companies did not put a total dollar figure on the transaction, but OpenAI executives estimate that 1GW of capacity costs about $50bn to bring online, with two-thirds of that spent on chips and the infrastructure to support them. The deal comes just a fortnight after AMD's rival Nvidia announced it planned to invest $100bn in OpenAI, with the two companies pledging to deploy 10GW of new data centre capacity. AMD has also issued OpenAI a warrant to purchase as many as 160mn shares at an exercise price of $0.01 over time based on AMD "achieving certain share price targets" and OpenAI deploying its chips. That would equate to roughly 10 per cent of the company. The transaction is the latest intended to accelerate OpenAI's development of new data centres to train and power its AI models, and to ensure the group's central position in the race to build the cutting-edge technology. "This partnership is a major step in building the compute capacity needed to realise AI's full potential," OpenAI chief executive Sam Altman said. But critics have raised concerns over the circular structure of such huge AI infrastructure deals, amid uncertainty over how the hug data centres envisaged by OpenAI would be financed or powered. AMD has pushed to establish itself as a credible alternative to Nvidia's chip and software for AI, seeking to narrow Nvidia's technological lead and winning business from companies such as Microsoft and Meta. The deal commits OpenAI to buying AMD's upcoming MI450, its most advanced AI chip, which aims to compete with Nvidia's latest Blackwell products and is due to hit the market in the second half of next year. This means OpenAI is likely to be one of AMD's biggest customers for the new technology, with people familiar with the matter adding that the two groups have worked closely together over recent weeks to determine the specifications of the MI450. Altman has said AI's demand for computing power far exceeds current capacity. He is attempting to stimulate infrastructure development, while binding some of the key businesses in the technology's supply chain closer to his start-up. OpenAI has also committed to purchasing $300bn in computing power from Oracle over the next five years, and is working with Oracle, SoftBank and other development partners to build US data centres with a further 7GW of power demand. In addition, it is working to produce its own AI chips with Broadcom. In all, those deals commit OpenAI to using 23GW of new capacity which, by the company's own estimation, would cost well over $1tn to develop. The company's growth since the 2022 release of ChatGPT has been unprecedented, with revenue having shot up to about $13bn on an annualised basis. But OpenAI remains lossmaking due to the steep cost of model development, marketing and hiring. Its recent deals are long-term and will be paid in increments as operational expenditure, meaning OpenAI is not committing to spending hundreds of billions of dollars upfront. As part of its arrangement with AMD, OpenAI could buy chips directly or rent them via a third party cloud company, according to a person with knowledge of the deal. Nonetheless, the company must find creative ways to meet its ballooning future liabilities. OpenAI executives are betting that ChatGPT continues to grow steadily from 700mn weekly users, and that they can push the proportion of paid subscribers beyond its current 5 per cent level. They are also exploring new lines of revenue, including a recently launched shopping feature and an AI device designed with former Apple star designer Jony Ive. Having raised about $60bn to date, OpenAI is now looking to lean on its partners' balance sheets and the debt market to meet its insatiable power demands. OpenAI plans to leverage Nvidia's equity investment, for instance, using the backing of the world's most valuable company to secure better terms from lenders, according to an executive at the company. The AMD deal "is expected to deliver tens of billions of dollars in revenue for AMD while accelerating OpenAI's AI infrastructure build-out", said Jean Hu, AMD's chief financial officer. "This agreement creates significant strategic alignment and shareholder value for both AMD and OpenAI."

AMD stock skyrockets 25% as OpenAI looks to take stake through AI chip deal

AMD stock skyrocketed more than 25% Monday during premarket trading following the news. OpenAI will deploy 6 gigawatts of AMD's Instinct graphics processing units over multiple years and across multiple generations of hardware, the companies said Monday. It will kick off with an initial 1 gigawatt rollout of chips in the second half of 2026. As part of the tie-up, AMD has issued OpenAI a warrant for up to 160 million shares of AMD common stock, with vesting milestones tied to both deployment volume and AMD's share price. The first tranche vests with the first full gigawatt deployment, with additional tranches unlocking as OpenAI scales to 6 gigawatts and meets key technical and commercial milestones required for large-scale rollout. If OpenAI exercises the full warrant, it could acquire approximately 10% ownership in AMD, based on the current number of shares outstanding. The ChatGPT maker said the deal was worth billions, but declined to disclose a specific dollar amount. "AMD's leadership in high-performance chips will enable us to accelerate progress and bring the benefits of advanced AI to everyone faster," Altman said in a release announcing the partnership.

OpenAI and chipmaker AMD sign chip supply partnership for AI infrastructure

Semiconductor maker AMD will supply its chips to ChatGPT maker OpenAI as part of agreement to team up on building artificial intelligence infrastructure, the companies said Monday. According to a joint statement announcing the deal, AMD will provide OpenAI with its high performance graphics chips. It calls for supplying 6 gigawatts of computing power for OpenAI's "next generation" AI infrastructure, with the first gigawatt coming online in the second half of next year. AMD also issued OpenAI with a warrant allowing the AI company to buy up to 160 million shares of AMD's common stock, which amounts to about 10% of company. The warrant will vest based on two milestones tied to the amount of computing power deployed. The agreement is a boost for AMD, which has been left behind by rival Nvidia, which has ballooned in value because its graphics processing chips are prized by AI companies.

OpenAI Agrees to Use Computer Chips from AMD

Late last month, OpenAI announced a $100 billion agreement to use computer chips from Nvidia, the world's most valuable publicly traded company. Now, OpenAI has entered a similar agreement with AMD, one of the many chipmakers hoping to challenge Nvidia as the dominant supplier of chips used to power artificial intelligence technologies like OpenAIs ChatGPT. On Monday, OpenAI said that it would begin using AMD chips in the second half of next year as it builds new computer data centers. The new facilities would be separate from the data centers OpenAI has committed to building in Texas, New Mexico, Ohio and a not-yet-named site in the Midwest. Over several years, OpenAI plans to deploy enough AMD chips to consume 6 gigawatts of power, an amount that could supply all the households in Massachusetts. As part of its recent agreement with Nvidia, OpenAI agreed to deploy enough chips to consume 10 gigawatts. AMD is not investing in OpenAI. But the agreement allows OpenAI to buy up to 160 million shares in the chipmaker at a penny per share, enough to give OpenAI a 10 percent stake in the chipmaker. It could also supply OpenAI with additional capital as it worked to build new computing facilities over the next several years. Explore Our Coverage of Artificial Intelligence OpenAI's New Video App Is Jaw-Dropping (for Better and Worse) OpenAI Completes Deal That Values It at $500 Billion Top A.I. Researchers Leave OpenAI, Google and Meta for New Start-Up Why Don't Data Centers Use More Green Energy? Countries Consider A.I.'s Dangers and Benefits at U.N. A.I. Fighter Jets and Cockroach Spies: Inside the Changing Business of War What We Know About ChatGPT's New Parental Controls The New AirPods Can Translate Languages in Your Ears. This Is Profound. With the Em Dash, A.I. Embraces a Fading Tradition The agreement is part of a wider effort among tech companies to spend hundreds of billions of dollars on the construction of new data centers. OpenAI, Amazon, Google, Meta and Microsoft plan to spend more than $325 billion combined on these facilities by the end of this year alone. Tech giants like Amazon, Microsoft and Google, which pull in tens of billions of dollars in profits each year, have been able to finance data center construction with cash they have on hand. But as newer and smaller companies like OpenAI have built computing facilities, they have been forced to raise or borrow tens of billions of dollars. Through its Stargate Project, OpenAI previously said it was working with the cloud computing company Oracle and the Japanese conglomerate SoftBank to spend more than $400 billion on new data centers in the United States. But the start-up and its partners do not have to money needed to pay for these data centers. So, it has looked for creative ways of bridging the financial gap. In its recent deal with Nvidia, OpenAI agreed to deploy Nvidia's chips. It also received a $100 billion investment from Nvidia. After investing an initial $10 billion in OpenAI, the chipmaker plans to invest an additional $90 billion in the company over the next several years. The agreement was the latest example of OpenAI raising money from the companies it relies on for products and services. (The Times sued OpenAI and Microsoft in 2023 for copyright infringement of news content related to A.I. systems. The two companies have denied those claims.)

OpenAI signs huge chip deal with AMD, and AMD stock soars

OpenAI has struck a sweeping deal with chipmaker AMD to secure processors for artificial intelligence systems, an agreement that could give the ChatGPT maker a 10% stake in AMD and further speeds up its trillion-dollar infrastructure push. The companies announced Monday that OpenAI will deploy up to 6 gigawatts of AMD's high-performance graphics processing units, or GPUs, across several years and generations of hardware. The rollout will begin in the second half of 2026, and more capacity will be added in phases until the full 6-gigawatt target is reached. AMD issued OpenAI a warrant for as many as 160 million shares of its stock, which could give the ChatGPT owner about about a tenth of the chipmaker's shares. The amount of stock it eventually owns is tied to both to the scale of AMD hardware deployed and to share price milestones. The chipmaker's shares jumped as much as 24% in premarket trading Monday as executives said it would add tens of billions of dollars in revenue. Rival Nvidia, which recently unveiled a $100 billion deal of its own with OpenAI, slipped about 1%. It's the latest in a string of infrastructure deals for OpenAI. The company has pledged roughly $1 trillion in the last two weeks to expand its computing base, including a dedicated supply agreement with Nvidia. Analysts have said the scale of investment rivals the energy demand of major cities. OpenAI chief executive Sam Altman called the new deal "a major step in building the compute capacity needed to realize AI's full potential. AMD's leadership in high-performance chips will enable us to accelerate progress and bring the benefits of advanced AI to everyone faster." AMD has been investing heavily in recent years in the market for so-called accelerator chips, which are used to train and run advanced AI models, in which rival Nvidia is dominant. Nvidia's data center division generated more than $115 billion in sales last year, while AMD's AI-related revenue is expected to reach about $6.5 billion in 2025. "We are thrilled to partner with OpenAI to deliver AI compute at massive scale," AMD's chief executive Lisa Su said. "This agreement creates a true win-win enabling the world's most ambitious AI buildout and advancing the entire AI ecosystem." AMD's chief financial officer Jean Hu added that the deal is "expected to deliver tens of billions of dollars in revenue" for the company.

AMD signs AI chip-supply deal with OpenAI

SAN FRANCISCO -- AMD said on Monday it will supply artificial intelligence chips to OpenAI in a multi-year deal that would bring in tens of billions of dollars in annual revenue and give the ChatGPT creator the option to buy up to roughly 10% of the chipmaker. 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. "We view this deal as certainly transformative, not just for AMD, but for the dynamics of the industry," AMD executive vice president Forrest Norrod told Reuters on Sunday. The agreement covers the deployment of hundreds of thousands of AMD's AI chips, or graphics processing units (GPUs), equivalent to six gigawatts, over several years beginning in the second half of 2026. AMD said OpenAI would build a one-gigawatt facility based on its forthcoming MI450 series of chips beginning next year, and that it would begin to recognize revenue then. AMD executives expect the deal to net tens of billions of dollars in annual revenue. Because of the ripple effect of the agreement, AMD expects to receive more than $100 billion in new revenue over four years from OpenAI and other customers, they said. "Other people are going to come along with it because this is really the pioneer, a pioneer in the industry that has a lot of influence over the broader ecosystem," AMD strategy chief Mat Hein said. The deal with AMD will help OpenAI build enough AI infrastructure to meet its needs, OpenAI CEO Sam Altman said in a statement. Analysts, on average, estimate AMD will generate revenue of $32.78 billion this year, according to LSEG data. As part of the arrangement, AMD issued a warrant that gives OpenAI the ability to buy up to 160 million shares of AMD for 1 cent each over the course of the chips deal. The warrant vests in tranches based on milestones that the two companies have agreed on. The first tranche will vest after the initial shipment of MI450 chips set for the second half of 2026. The remaining milestones include specific AMD stock price targets that escalate to $600 a share for the final installment of stock to unlock. AMD has 1.62 billion shares outstanding and is valued at $267.23 billion, according to LSEG data. Its shares closed on Friday at $164.67. OpenAI has a valuation of $500 billion. OpenAI has worked with AMD for years, providing inputs on the design of older generations of AI chips such as the MI300X. The San Francisco-based AI company has been taking a number of steps to ensure it has the chips needed for its future needs. In September, Nvidia announced an investment of up to $100 billion in OpenAI that included a plan to supply at least 10 gigawatts worth of Nvidia systems. The plan includes OpenAI deploying a gigawatt of Nvidia's next-generation Vera Rubin chips in late 2026. In addition to using Nvidia hardware, cloud computing giants such as Alphabet's GOOGL.O Google and Amazon AMZN.O build their own in-house processors. Similarly, OpenAI is in the process of developing its own silicon for AI use and has partnered with Broadcom AVGO.O, Reuters reported last year. OpenAI and its main backer Microsoft also announced last month that they had signed a non-binding agreement to restructure OpenAI into a for-profit entity, signaling further changes in the governance of the fast-growing AI company. A person familiar with the matter said the deal with AMD does not change any of OpenAI's ongoing compute plans, including that effort or its partnership with Microsoft.

OpenAI and AMD to Deploy 6 GW of GPUs | AIM

The first 1 GW of deployment of AMD Instinct MI450 GPUs is set to begin in the second half of next year. OpenAI announced a partnership with AMD to deploy 6 gigawatts (GW) of compute power to support its AI infrastructure. The first 1 GW of deployment of AMD Instinct MI450 GPUs is set to begin in the second half of next year. Besides, AMD has granted OpenAI a warrant for up to 160 million shares of its common stock. This warrant is structured to vest in tranches, with the first tranche vesting upon the initial 1 GW deployment of AMD's GPUs. Subsequent tranches will vest as purchases scale up to 6 gigawatts. Vesting is also tied to AMD achieving specific share-price targets and OpenAI meeting the necessary milestones to facilitate large-scale deployments of AMD GPUs. "AMD's leadership in high-performance chips will enable us to accelerate progress and bring the benefits of advanced AI to everyone faster," said Sam Altman, CEO of OpenAI, in the announcement. This partnership deepens the collaboration between the two companies, which began with OpenAI using AMD's MI300X series last year to power its services via Azure. "Our partnership with OpenAI is expected to deliver tens of billions of dollars in revenue for AMD while accelerating OpenAI's AI infrastructure buildout," said Jean Hu, CFO of AMD. Over the last few weeks, OpenAI has signed numerous partnerships and deals with companies such as Oracle, Softbank, and NVIDIA to expand its compute capacity. Last month, OpenAI and NVIDIA signed a letter of intent for a strategic partnership to deploy at least 10 gigawatts of NVIDIA systems for OpenAI's next-generation AI infrastructure. The agreement includes NVIDIA investing up to $100 billion in OpenAI, tied to each gigawatt of systems deployed. Furthermore, OpenAI announced five new AI data centre sites, along with Oracle and SoftBank, in the United States. The announcement is part of the Stargate Project, the $500 billion initiative to build AI infrastructure across the US, led by OpenAI and SoftBank in partnership with Oracle, MGX, Arm, Microsoft and NVIDIA.

NVIDIA directly challenged after AMD and OpenAI sign multibillion GPU partnership

TL;DR: OpenAI and AMD have formed a multibillion-dollar partnership where AMD will power OpenAI's next-generation AI infrastructure with up to 6 gigawatts of AMD Instinct MI450 GPUs starting in late 2026. The deal includes multi-generational hardware upgrades and stock agreements tied to deployment milestones, enhancing AI compute capacity. OpenAI and AMD have announced a multibillion-dollar partnership that involves AMD powering the next generation of OpenAI's AI infrastructure with AMD Instinct MI450 GPUs. OpenAI CEO Sam Altman (left) and AMD CEO Lisa Su (right) The partnership was announced by both companies via press releases, and includes AMD supplying OpenAI with 6 gigawatts of power through its AMD Instinct GPUs, with the first gigawatt to be deployed in the second half of 2026. In addition to signing on for multi-generational hardware upgrades from AMD, OpenAI will be acquiring up to 160 million shares of AMD common stock, which have been structured to vest as specific milestones are achieved. The first tranche of the stock is set to vest after the initial gigawatt is successfully deployed, and further tranches are scheduled to vest as more AMD GPUs are purchased by OpenAI, eventually reaching the point of 6 gigawatts. Notably, vesting is also tied to AMD reaching specific share price targets and OpenAI achieving the technical and commercial milestones required to enable AMD deployments at scale. "We are thrilled to partner with OpenAI to deliver AI compute at massive scale. 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," said Dr. Lisa Su, chair and CEO, AMD "This partnership is a major step in building the compute capacity needed to realize AI's full potential. AMD's leadership in high-performance chips will enable us to accelerate progress and bring the benefits of advanced AI to everyone faster," said Sam Altman, co-founder and CEO of OpenAI Notably, this partnership between OpenAI and NVIDIA comes only weeks after OpenAI announced a similar partnership with NVIDIA, the current industry leader in AI GPUs. However, OpenAI and NVIDIA's deal included NVIDIA providing hardware for up to 10 gigawatts of power to deploy OpenAI's next-generation artificial intelligence software.

OpenAI and chipmaker AMD sign chip supply partnership for AI infrastructure

AMD is announcing a deal to supply its chips to OpenAI for building AI infrastructure Semiconductor maker AMD will supply its chips to ChatGPT maker OpenAI as part of agreement to team up on building artificial intelligence infrastructure, the companies said Monday. According to a joint statement announcing the deal, AMD will provide OpenAI with its high performance graphics chips. It calls for supplying 6 gigawatts of computing power for OpenAI's "next generation" AI infrastructure, with the first gigawatt coming online in the second half of next year. AMD also issued OpenAI with a warrant allowing the AI company to buy up to 160 million shares of AMD's common stock, which amounts to about 10% of company. The warrant will vest based on two milestones tied to the amount of computing power deployed. The agreement is a boost for AMD, which has been left behind by rival Nvidia, which has ballooned in value because its graphics processing chips are prized by AI companies.

OpenAI and chipmaker AMD sign chip supply partnership for AI infrastructure

Semiconductor maker AMD will supply its chips to ChatGPT maker OpenAI as part of an agreement to team up on building artificial intelligence infrastructure, the companies said Monday. According to a joint statement announcing the deal, AMD will provide OpenAI with the latest version of its high performance graphics chips expected to debut next year. It calls for supplying 6 gigawatts of computing power for OpenAI's "next generation" AI infrastructure, with the first gigawatt coming online in the second half of 2026. AMD also issued OpenAI with a warrant allowing the AI company to buy up to 160 million shares of AMD's common stock, which amounts to about 10% of company. The warrant will vest based on two milestones tied to the amount of computing power deployed. "This partnership is a major step in building the compute capacity needed to realize AI's full potential," OpenAI CEO Sam Altman, said in a news release. "AMD's leadership in high-performance chips will enable us to accelerate progress and bring the benefits of advanced AI to everyone faster." The agreement is a boost for Santa Clara, Calif.-based AMD, which has been left behind by rival Nvidia. The AI boom has fuelled demand for Nvidia's graphics processing chips, sending its shares soaring and making it the world's most valuable company.

OpenAI signs multibillion-dollar deal with chipmaker AMD

Gift 5 articles to anyone you choose each month when you subscribe. AMD inked a deal with OpenAI to roll out AI infrastructure in a pact the chipmaker said could generate tens of billions of dollars in new revenue. AMD's shares soared. The two signed a definitive agreement for OpenAI to deploy 6 gigawatts of AMD GPUs over multiple years, the companies said Monday in a statement. AMD has given OpenAI a warrant for up to 160 million shares, which will vest as milestones are achieved. Those targets require AMD's stock price to continue to increase in value and future exercise points include a tranche tied to a share price of $US600. AMD shares closed Friday at $US164.67.

OpenAI and Chipmaker AMD Sign Chip Supply Partnership for AI Infrastructure

Semiconductor maker AMD will supply its chips to ChatGPT maker OpenAI as part of an agreement to team up on building artificial intelligence infrastructure, the companies said Monday. According to a joint statement announcing the deal, AMD will provide OpenAI with the latest version of its high performance graphics chips expected to debut next year. It calls for supplying 6 gigawatts of computing power for OpenAI's "next generation" AI infrastructure, with the first gigawatt coming online in the second half of 2026. AMD also issued OpenAI with a warrant allowing the AI company to buy up to 160 million shares of AMD's common stock, which amounts to about 10% of company. The warrant will vest based on two milestones tied to the amount of computing power deployed. "This partnership is a major step in building the compute capacity needed to realize AI's full potential," OpenAI CEO Sam Altman, said in a news release. "AMD's leadership in high-performance chips will enable us to accelerate progress and bring the benefits of advanced AI to everyone faster." The agreement is a boost for Santa Clara, Calif.-based AMD, which has been left behind by rival Nvidia. The AI boom has fuelled demand for Nvidia's graphics processing chips, sending its shares soaring and making it the world's most valuable company.

AMD stock soars 27% in pre-market today: Why AMD shares are exploding after OpenAI's massive AI chip deal -- is Nvidia's dominance at risk?

AMD stock is soaring today. Shares jumped 27% in pre-market trading. The surge comes after OpenAI announced a $10 billion AI chip deal with AMD. Investors are watching closely. Analysts say this partnership could challenge Nvidia's dominance in the AI chip market. Market excitement is at an all-time high. AMD stock surged sharply in pre-market trading on Monday. Shares jumped 27% to $210 after the company announced a multibillion-dollar deal with OpenAI. The AI chip partnership is valued at around $10 billion and is expected to span multiple years. Investors reacted quickly, pushing the stock higher amid optimism about AMD's role in AI infrastructure. OpenAI will deploy up to six gigawatts of AMD Instinct MI450 GPUs over the coming years. The initial rollout of one gigawatt is scheduled for 2026. Analysts say this could generate tens of billions in revenue for AMD, boosting the company's long-term growth prospects. OpenAI also secured a warrant to acquire up to 160 million AMD shares at a nominal price. If exercised, this could give OpenAI roughly a 10% stake in AMD, aligning the company's success with AMD's performance. The market interpreted this deal as a major validation of AMD's AI strategy. Nvidia has dominated the AI chip market for years, but OpenAI's choice to partner with AMD signals growing competition. Experts believe this could gradually challenge Nvidia's market share and influence. Investor sentiment is positive, and many see AMD's technology as capable of supporting next-generation AI workloads at scale. AMD stock is predicted to rise in the near term following its recent surge from the OpenAI deal announcement. For October 2025, forecasts show the stock starting at around $164 with a potential maximum price of $193 and an average price near $171, closing the month near $179, reflecting a 9.1% gain. Longer-term predictions suggest steady growth, with November's forecast averaging around $185 and reaching $195 by the end of that month. Analyst consensus and forecast models project continued upside driven by strong demand for AI infrastructure and AMD's strategic partnerships, including the OpenAI deal. The stock is currently trading around $164.67 with some volatility, and the general outlook remains positive for the rest of 2025. Some analysts caution that execution risk remains. Meeting deployment targets and production timelines for large-scale GPU orders is complex. Any delays or setbacks could temper investor enthusiasm. However, the overall market view is that AMD's partnership with OpenAI positions it as a serious competitor in the AI chip space. Advanced Micro Devices (AMD) stunned investors this week as its stock surged more than 25% in pre-market trading, reaching $210.08 per share -- its highest level ever. The rally came right after AMD announced a multibillion-dollar partnership with OpenAI, the company behind ChatGPT, marking one of the largest and most influential AI hardware deals to date. This collaboration positions AMD at the center of the growing AI revolution. Investors quickly reacted, viewing this deal as a turning point that could reshape the competitive landscape of the semiconductor industry. In a single trading session, AMD added billions of dollars to its market capitalization, signaling how deeply the market believes in the potential of AI-driven growth. AMD has long been seen as the closest competitor to Nvidia in the high-performance computing space. But with this deal, it's not just competing -- it's securing a seat at the core of the AI infrastructure powering next-generation technologies. Under the new agreement, AMD will deliver up to 6 gigawatts of AI computing power to OpenAI over the next few years. This massive supply will help OpenAI expand its infrastructure to support larger and more complex artificial intelligence models. The first 1 gigawatt is expected to be deployed in the second half of 2026, setting the stage for continued growth in AI research and product development. In simpler terms, AMD will provide the high-performance chips that train and run AI systems -- the same kind of technology used to power tools like ChatGPT. As AI demand skyrockets worldwide, this partnership ensures OpenAI gets the compute power it needs while giving AMD a long-term revenue stream from one of the biggest names in technology. Executives from AMD expect the deal could generate tens of billions of dollars in future revenue. That potential has made this announcement one of the most exciting developments in the tech sector this year. One of the most surprising parts of the deal is that OpenAI now holds a warrant to buy up to 160 million AMD shares, representing about a 10% ownership stake. The option comes with a nominal exercise price -- reportedly just one cent per share -- but it only becomes valid once AMD meets specific performance and supply goals. This structure ties OpenAI's success directly to AMD's growth. The better AMD performs in delivering on its commitments, the more OpenAI benefits financially. It's a rare form of partnership that goes beyond a typical supply contract -- it creates a shared incentive for both companies to scale faster, innovate more, and expand their presence in the AI ecosystem. For investors, this setup signals confidence from both sides. OpenAI's willingness to take an ownership position shows strong belief in AMD's technology and future. Meanwhile, AMD gains credibility as a trusted supplier capable of delivering at massive scale. This partnership comes at a crucial time for AMD. For years, Nvidia has dominated the AI chip market, with its GPUs becoming the backbone of machine learning systems worldwide. But AMD has been steadily investing in AI hardware, particularly through its MI300 series GPUs, which are designed for high-efficiency, large-scale AI workloads. Now, with OpenAI choosing AMD as a key partner, the company's role in the global AI supply chain just became much stronger. The deal effectively positions AMD as an alternative to Nvidia for companies building advanced AI models and cloud infrastructure. Investors are also viewing this as a strategic victory. AMD's technology now has the opportunity to be deployed in one of the most demanding AI environments in the world -- OpenAI's data centers. That exposure could help AMD attract more major AI clients in the coming years, expanding its influence far beyond the consumer and gaming markets where it's been traditionally strong. While the market reaction has been overwhelmingly positive, experts note that this deal comes with big challenges. Delivering 6 gigawatts of AI compute capacity is an enormous task, requiring large-scale chip production, manufacturing expansion, and robust supply chain coordination. Any delays or technical issues could impact revenue timelines and investor confidence. Another concern is shareholder dilution. If OpenAI exercises its full warrant option, AMD will need to issue new shares, potentially reducing the value of existing ones. However, analysts suggest the long-term benefits -- including revenue growth and market positioning -- outweigh the short-term dilution risk. Still, success will depend on flawless execution. AMD must ramp up production, deliver high-performance chips on schedule, and maintain competitive pricing against Nvidia, which remains a dominant force in AI. Analysts view this deal as transformative for AMD, positioning it as a stronger competitor against Nvidia in the AI infrastructure market. The partnership highlights AMD's growing role in powering AI workloads, and investors have responded with enthusiasm given the long-term revenue potential. OpenAI CEO Sam Altman emphasized the collaboration's importance in scaling AI infrastructure, while AMD CEO Lisa Su expressed excitement about delivering compute at massive scale in AI development. The deal significantly enhances AMD's growth outlook, leading to the sharp surge in stock price today.

Why Is AMD Stock Skyrocketing Monday? - Advanced Micro Devices (NASDAQ:AMD)

Advanced Micro Devices (NASDAQ:AMD) shares surged premarket Monday following a landmark agreement with OpenAI to deploy up to 6 gigawatts of AMD Instinct GPU power for the tech giant's next-generation AI infrastructure. The initial phase will see a 1-gigawatt rollout of AMD Instinct MI450 GPUs in the second half of 2026, with plans for subsequent expansions across multiple generations of AMD's data center chips. Under the agreement, OpenAI will designate AMD as a core compute partner, leveraging the MI450 series and rack-scale AI solutions. Also Read: AMD Expands Cohere Partnership To Power Enterprise AI On Instinct Chips The collaboration will also extend into next-generation hardware and software development. Both companies will share technical expertise to align product roadmaps and optimize performance, building on a partnership that began with AMD's MI300X accelerators and continued through the MI350X series. As part of the deal, AMD issued OpenAI a warrant for up to 160 million AMD shares, vesting in tranches tied to deployment milestones. The first tranche coincides with the initial 1-gigawatt rollout, with further vesting linked to expansions up to 6 gigawatts, as well as share-price and infrastructure benchmarks. AMD Chief Financial Officer Jean Hu described the partnership as having the potential to generate "tens of billions of dollars in revenue" and be "highly accretive" to AMD's adjusted earnings per share. AMD stock breached its 52-week high of $186.65 on Monday, trading at $219.99 at the time of publication, a 33.59% increase. The announcement follows Nvidia's (NASDAQ:NVDA) recent $100 billion commitment to OpenAI, which includes plans to deploy at least 10 gigawatts of Nvidia's Vera Rubin systems starting in the second half of 2026. Bank of America Securities analyst Vivek Arya described Nvidia's move as both a bold financial commitment and a strategic moat expansion, estimating the partnership could generate $300 billion to $500 billion in long-term revenue, a potential three- to five-fold return on investment. Arya noted that Nvidia's collaboration with OpenAI strengthens its position in the global AI buildout while intensifying competitive pressure on peers such as Broadcom (NASDAQ:AVGO) and AMD. He also highlighted that Nvidia's $100 billion deployment represents a strategic use of its free cash flow, with projected margins of 40-50% on future AI-driven revenue streams. Photo by Poetra.RH via Shutterstock AMD Price Action: Advanced Micro Devices shares were trading higher by 33.59% to $219.99 premarket at last check Monday. Read Next: Nvidia, Broadcom, Marvell Poised To Gain Big From $1.2 Trillion AI Spending Wave By 2030: Analyst AMDAdvanced Micro Devices Inc$210.0927.6%OverviewAVGOBroadcom Inc$335.20-0.94%NVDANVIDIA Corp$186.24-0.74%Market News and Data brought to you by Benzinga APIs

AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake - The Economic Times

The agreement covers the deployment of hundreds of thousands of AMD's AI chips, or graphics processing units (GPUs), equivalent to six gigawatts, over several years beginning in the second half of 2026.AMD said on Monday it will supply artificial intelligence chips to OpenAI in a multi-year deal that would bring in tens of billions of dollars in annual revenue and give the ChatGPT creator the option to buy up to roughly 10% of the chipmaker. 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. Shares of AMD jumped more than 23% in premarket trading. "We view this deal as certainly transformative, not just for AMD, but for the dynamics of the industry," AMD executive vice president Forrest Norrod told Reuters on Sunday. The agreement covers the deployment of hundreds of thousands of AMD's AI chips, or graphics processing units (GPUs), equivalent to six gigawatts, over several years beginning in the second half of 2026. AMD said OpenAI would build a one-gigawatt facility based on its forthcoming MI450 series of chips beginning next year, and that it would begin to recognize revenue then. AMD executives expect the deal to net tens of billions of dollars in annual revenue. Because of the ripple effect of the agreement, AMD expects to receive more than $100 billion in new revenue over four years from OpenAI and other customers, they said. "Other people are going to come along with it because this is really the pioneer, a pioneer in the industry that has a lot of influence over the broader ecosystem," AMD strategy chief Mat Hein said. The deal with AMD will help OpenAI build enough AI infrastructure to meet its needs, OpenAI CEO Sam Altman said in a statement. Analysts, on average, estimate AMD will generate revenue of $32.78 billion this year, according to LSEG data. As part of the arrangement, AMD issued a warrant that gives OpenAI the ability to buy up to 160 million shares of AMD for 1 cent each over the course of the chips deal. The warrant vests in tranches based on milestones that the two companies have agreed on. The first tranche will vest after the initial shipment of MI450 chips set for the second half of 2026. The remaining milestones include specific AMD stock price targets that escalate to $600 a share for the final installment of stock to unlock. AMD has 1.62 billion shares outstanding and is valued at $267.23 billion, according to LSEG data. Its shares closed on Friday at $164.67. OpenAI has a valuation of $500 billion. OpenAI want more GPUs OpenAI has worked with AMD for years, providing inputs on the design of older generations of AI chips such as the MI300X. The San Francisco-based AI company has been taking a number of steps to ensure it has the chips needed for its future needs. In September, Nvidia announced an investment of up to $100 billion in OpenAI that included a plan to supply at least 10 gigawatts worth of Nvidia systems. The plan includes OpenAI deploying a gigawatt of Nvidia's next-generation Vera Rubin chips in late 2026. In addition to using Nvidia hardware, cloud computing giants such as Alphabet's Google and Amazon build their own in-house processors. Similarly, OpenAI is in the process of developing its own silicon for AI use and has partnered with Broadcom, Reuters reported last year. OpenAI and its main backer Microsoft also announced last month that they had signed a non-binding agreement to restructure OpenAI into a for-profit entity, signaling further changes in the governance of the fast-growing AI company. A person familiar with the matter said the deal with AMD does not change any of OpenAI's ongoing compute plans, including that effort or its partnership with Microsoft.

AMD and OpenAI Partner to Deploy 6 Gigawatts of GPUs for Next-Generation AI Infrastructure

AMD's strong leadership in high-performance computing systems and OpenAI's pioneering research and advancements in generative AI places the two companies at the forefront of this important and pivotal time for AI. Under this definitive agreement, OpenAI will work with AMD as a core strategic compute partner to drive large-scale deployments of AMD technology starting with the AMD Instinct MI450 series and rack-scale AI solutions and extending to future generations. By sharing technical expertise to optimize their product roadmaps, AMD and OpenAI are deepening their multi-generational hardware and software collaboration that began with the MI300X and continued with the MI350X series. This partnership creates a true win-win for both companies, enabling very large-scale AI deployments and advancing the entire ecosystem.

OpenAI and chipmaker AMD sign chip supply partnership for AI infrastructure

Semiconductor maker AMD will supply its chips to ChatGPT maker OpenAI as part of an agreement to team up on building artificial intelligence infrastructure, the companies said Monday. According to a joint statement announcing the deal, AMD will provide OpenAI with the latest version of its high performance graphics chips expected to debut next year. It calls for supplying six gigawatts of computing power for OpenAI's "next generation" AI infrastructure, with the first gigawatt coming online in the second half of 2026. AMD also issued OpenAI with a warrant allowing the AI company to buy up to 160 million shares of AMD's common stock, which amounts to about 10 per cent of company. The warrant will vest based on two milestones tied to the amount of computing power deployed. "This partnership is a major step in building the compute capacity needed to realize AI's full potential," OpenAI CEO Sam Altman, said in a news release. "AMD's leadership in high-performance chips will enable us to accelerate progress and bring the benefits of advanced AI to everyone faster." The agreement is a boost for Santa Clara, Calif.-based AMD, which has been left behind by rival Nvidia. The AI boom has fuelled demand for Nvidia's graphics processing chips, sending its shares soaring and making it the world's most valuable company.

AMD shares soar on OpenAI chip deal worth billions By Investing.com

Investing.com -- AMD shares jumped over 22% in early Monday trading after the company announced a multi-year agreement to supply artificial intelligence chips to OpenAI. The deal is expected to generate tens of billions of dollars in annual revenue for Advanced Micro Devices and includes an option for OpenAI to acquire up to approximately 10% of AMD's equity. Under the agreement, AMD will supply hundreds of thousands of graphics processing units equivalent to six gigawatts over several years beginning in the second half of 2026. OpenAI plans to construct a one-gigawatt facility using AMD's upcoming MI450 series chips starting next year, with AMD expecting to recognize revenue at that time. The chipmaker projects the agreement will contribute to more than $100 billion in new revenue over four years from OpenAI and other customers. "We view this deal as certainly transformative, not just for AMD, but for the dynamics of the industry," said AMD executive vice president Forrest Norrod. OpenAI CEO Sam Altman stated the partnership will help the company build sufficient AI infrastructure to meet its requirements.

OpenAI and AMD sign chip supply partnership for AI infrastructure | BreakingNews

Semiconductor maker AMD will supply its chips to artificial intelligence company OpenAI as part of an agreement to team up on building AI infrastructure, the companies said. OpenAI will also get the option to buy as much as a 10% stake in AMD, according to a joint statement announcing the deal. It is the latest deal for the ChatGPT maker as it races to beef up its AI computing resources. Under the terms of the deal, OpenAI will buy the latest version of the company's high performance graphics chips, the Instinct MI450, which is expected to debut next year. This partnership is a major step in building the compute capacity needed to realise AI's full potential The agreement calls for supplying six gigawatts of computing power for OpenAI's "next generation" AI infrastructure, with the first batch of chips worth one gigawatt to be deployed in the second half of 2026. AMD also issued OpenAI with a warrant allowing the AI company to buy up to 160 million shares of AMD's common stock. That amounts to about 10% of company based on AMD's 1.6 billion outstanding shares. The warrant will vest based on two milestones tied to the amount of computing power deployed, as well as unspecified "share-price targets". Shares of AMD spiked 25% before the opening bell on Monday. Shares of Nvidia, which have repeatedly set new record-highs this year, fell slightly. "This partnership is a major step in building the compute capacity needed to realise AI's full potential," said OpenAI chief executive Sam Altman. "AMD's leadership in high-performance chips will enable us to accelerate progress and bring the benefits of advanced AI to everyone faster." The deal is a boost for California-based AMD, which has been left behind by rival Nvidia. But it also hints at OpenAI's desire to diversify its supply chain away from Nvidia's dominance. The AI boom has fuelled demand for Nvidia's graphics processing chips, sending its shares soaring and making it the world's most valuable company. Last month, OpenAI and Nvidia announced a 100 billion-dollar partnership that will add at least 10 gigawatts of data centre computing power.

AMD enters into strategic partnership with OpenAI

AMD and OpenAI announce a 6 gigawatt agreement to power OpenAI's next-generation AI infrastructure across multiple generations of AMD Instinct GPUs. The first deployment of AMD Instinct MI450 GPUs for 1 gigawatt is expected to begin in H2 2026. NB: pmt +35.4%. AMD's strong leadership in high-performance computing systems and OpenAI's pioneering research and advances in generative AI place both companies at the forefront of this important and pivotal period for AI, they say. As part of the agreement, to further align their strategic interests, AMD has issued to OpenAI a warrant for up to 160 million AMD common shares, structured to be acquired as specific milestones are achieved. The first tranche is acquired with the initial deployment of 1 gigawatt, and additional tranches are acquired as purchases reach 6 gigawatts, both tech companies add. The acquisition is also contingent upon AMD achieving certain share price targets and OpenAI completing the technical and commercial milestones necessary to enable AMD's large-scale deployments.

AMD soars after major strategic partnership with OpenAI

AMD's stock jumped 25% on Monday morning following the announcement of a major agreement with OpenAI, which includes a potential 10% stake in the chipmaker. The startup led by Sam Altman will deploy up to 6 gigawatts of AMD Instinct GPUs across multiple generations of hardware, including 1 gigawatt by 2026. The deal, one of the largest ever in the AI sector, marks a key step in OpenAI's diversification strategy in the face of Nvidia's dominance. To finalize the agreement, AMD issued OpenAI a warrant for 160 million common shares, exercisable in several tranches as the project progresses. If all warrants are exercised, OpenAI will hold approximately 10% of AMD's capital. Sam Altman praised the group's technological leadership, while Lisa Su, CEO of AMD, described a "win-win" partnership supporting unprecedented industrial expansion in AI. This collaboration is part of OpenAI's massive investment plan, estimated at nearly $1 trillion, which already includes a 10-gigawatt contract with Nvidia. The partnership illustrates the high degree of interdependence in the sector, where a small circle of players -- OpenAI, AMD, Nvidia, Oracle and Broadcom -- concentrate capital, production, and infrastructure. While this circularity strengthens the power of the ecosystem, it also increases systemic risks. For AMD, the agreement represents a strategic breakthrough and a major validation of its Instinct range, as the company aims to establish a lasting presence in the AI accelerator market.

Advanced Micro Devices, Inc. and OpenAI Announce Strategic Partnership to Deploy 6 Gigawatts of AMD GPUs

Advanced Micro Devices, Inc. and OpenAI announced a 6 gigawatt agreement to power OpenAI?s next-generation AI infrastructure across multiple generations of AMD Instinct GPUs. The first 1 gigawatt deployment of AMD Instinct MI450 GPUs is set to begin in the second half of 2026.AMD?s strong leadership in high-performance computing systems and OpenAI's pioneering research and advancements in generative AI places the two companies at the forefront of this important and pivotal time for AI. Under this definitive agreement, OpenAI will work with AMD as a core strategic compute partner to drive large-scale deployments of AMD technology starting with the AMD Instinct MI450 series and rack-scale AI solutions and extending to future generations. By sharing technical expertise to optimize their product roadmaps, AMD and OpenAI are deepening their multi-generational hardware and software collaboration that began with the MI300X and continued with the MI350X series. This partnership creates a true win-win for both companies, enabling very large-scale AI deployments and advancing the entire ecosystem. Through this partnership, AMD and OpenAI are building the infrastructure to meet the world?s growing AI demands, by combining world-class innovation and execution to accelerate the future of high-performance and AI computing.

AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake

SAN FRANCISCO (Reuters) -AMD said on Monday it will supply artificial intelligence chips to OpenAI in a multi-year deal that would bring in tens of billions of dollars in annual revenue and give the ChatGPT creator the option to buy up to roughly 10% of the chipmaker. 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. Shares of AMD jumped more than 23% in premarket trading. "We view this deal as certainly transformative, not just for AMD, but for the dynamics of the industry," AMD executive vice president Forrest Norrod told Reuters on Sunday. The agreement covers the deployment of hundreds of thousands of AMD's AI chips, or graphics processing units (GPUs), equivalent to six gigawatts, over several years beginning in the second half of 2026. AMD said OpenAI would build a one-gigawatt facility based on its forthcoming MI450 series of chips beginning next year, and that it would begin to recognize revenue then. AMD executives expect the deal to net tens of billions of dollars in annual revenue. Because of the ripple effect of the agreement, AMD expects to receive more than $100 billion in new revenue over four years from OpenAI and other customers, they said. "Other people are going to come along with it because this is really the pioneer, a pioneer in the industry that has a lot of influence over the broader ecosystem," AMD strategy chief Mat Hein said. The deal with AMD will help OpenAI build enough AI infrastructure to meet its needs, OpenAI CEO Sam Altman said in a statement. Analysts, on average, estimate AMD will generate revenue of $32.78 billion this year, according to LSEG data. As part of the arrangement, AMD issued a warrant that gives OpenAI the ability to buy up to 160 million shares of AMD for 1 cent each over the course of the chips deal. The warrant vests in tranches based on milestones that the two companies have agreed on. The first tranche will vest after the initial shipment of MI450 chips set for the second half of 2026. The remaining milestones include specific AMD stock price targets that escalate to $600 a share for the final installment of stock to unlock. AMD has 1.62 billion shares outstanding and is valued at $267.23 billion, according to LSEG data. Its shares closed on Friday at $164.67. OpenAI has worked with AMD for years, providing inputs on the design of older generations of AI chips such as the MI300X. The San Francisco-based AI company has been taking a number of steps to ensure it has the chips needed for its future needs. In September, Nvidia announced an investment of up to $100 billion in OpenAI that included a plan to supply at least 10 gigawatts worth of Nvidia systems. The plan includes OpenAI deploying a gigawatt of Nvidia's next-generation Vera Rubin chips in late 2026. In addition to using Nvidia hardware, cloud computing giants such as Alphabet's Google and Amazon build their own in-house processors. Similarly, OpenAI is in the process of developing its own silicon for AI use and has partnered with Broadcom, Reuters reported last year. OpenAI and its main backer Microsoft also announced last month that they had signed a non-binding agreement to restructure OpenAI into a for-profit entity, signaling further changes in the governance of the fast-growing AI company. A person familiar with the matter said the deal with AMD does not change any of OpenAI's ongoing compute plans, including that effort or its partnership with Microsoft. (Reporting by Max A. Cherney in San Francisco; Additional reporting by Deepa Seetharaman in San Francisco; Editing by Muralikumar Anantharaman)