On Monday, Openai bestowed its blessings and support on another tech company by striking a deal with Chips makers Advanced Micro Devices, instantly making it one of the hot companies investors are hoping will be at the forefront of artificial intelligence creations.
AMD shares rose more than 30% after the company behind CHATGPT said it plans to increase its stake in the chipmaker to 10%. This marks the latest example in Sam Altman's multibillion-dollar deal frenzy that is reshaping the American chip industry, where Upstart Openai appears to have the power to pick new winners, revive laggards and move public markets through its partnerships.
Under the multi-year deal, OpenAI will acquire AMD AI chips, which will run data processing facilities that, in total, could draw six gigawatts of electrical power to run the chips. The first one Gigawatt deployment will begin with AMD MI450 GPUs in the second half of 2026.
“This partnership is an important step in building the computing capabilities needed to realize the full potential of AI,” said Altman, CEO of Openai, in a statement. “AMD's leadership in high-performance chips will allow us to accelerate progress and bring the benefits of advanced AI faster.”
OpenAI received a warrant to buy up to 160 million shares of AMD common stock, which represents about 10% of the chipmaker. The stock acquisition will not occur simultaneously and is intended as a multi-year commitment where Openai can purchase AMD shares at the low price of $0.01.
Shares are only granted for achieving certain milestones tied to AMD achieving certain share price targets, and if Openai continues to purchase and deploy AMD chips at scale. The release said the first equity tranche lives with an initial deployment of one gigawatt, with additional tranches as purchases scale up to six gigawatts.
The deal is expected to generate tens of billions of dollars in revenue for AMD.
“This partnership brings together the best of AMD and Openai to create a true win-win, delivering the world's most ambitious AI creation and advancing the entire AI ecosystem,” said Dr. Lisa Su, Chairman and CEO of AMD, in a press release.
Globally, companies are expected to spend $375 billion on artificial intelligence infrastructure in 2025.
The race to create artificial general intelligence—a hypothetical AI system capable of performing all the cognitive tasks performed by humans—has begun the need to build large-scale AI data centers that house specialized chips called graphics units.
NVIDIA is the leading supplier of such graphics chips and commands 70% of AI chip sales. However, as demand for different types of AI workloads has increased, both startups and legacy rivals have sought to offer more affordable alternatives to Nvidia chips.
Altman has repeatedly spoken out about the chip shortage and has sought to diversify Openai's chip supply, signing a $10 billion deal with Broadcom early last month to develop custom AI chips.
OpenAI is currently valued at $500 billion, with 700 million weekly active users.
Altman sought to invest billions of dollars in computing resources to support Openai's efforts to win the artificial intelligence race. In January, along with Japanese SoftBank and Oracle database provider Openai, Openai committed $100 billion to build AI infrastructure in the United States. As part of “Project Stargate”, the companies plan to invest 500 billion dollars Over the next four years.
Openai signed deal with In May, to build a one-Gigawatt data center complex in the United Arab Emirates, a deal that was struck by the Trump administration. Oracle, Nvidia, Softbank, Cisco and the Royals Emirati AI Company-backed G42 are set to back the project.
