AMD–OpenAI Partnership Marks a New Chapter in the AI Race
- Buster Wurm
- Oct 7
- 2 min read
Advanced Micro Devices (AMD) has struck a landmark multibillion-dollar deal with OpenAI to supply GPUs for artificial intelligence infrastructure, marking one of the most direct challenges yet to Nvidia’s dominance in the AI chip market. The five-year agreement will see OpenAI deploy AMD’s MI450 chips beginning in 2026. Speculatively, it could generate tens of billions of dollars in new revenue for AMD, according to Lisa Su, Chief Executive Officer.
The pact also grants OpenAI warrants to acquire up to 160 million AMD shares at one cent each—about 10% of the company—if specific deployment milestones and stock price targets are met. AMD’s shares surged nearly 24% following the announcement, closing at $203.71 and adding over $60 billion in market value.
Both companies framed the partnership as mutually reinforcing. “It’s a win for both of our companies,” Su said, noting that OpenAI’s incentives are tied to AMD’s success and vice versa. OpenAI CEO Sam Altman emphasized the difficulty of meeting the soaring computing demands, calling the deal part of an industry-wide effort to expand infrastructure rapidly.
Beyond immediate gains, the agreement positions AMD as a credible alternative to Nvidia in powering the next generation of AI systems. Analysts say the deal could lift AMD’s data center revenue from $6.5 billion this year to over $100 billion in the future if growth continues.
Bloomberg and The Wall Street Journal report increasing concerns about an emerging AI "bubble" as companies invest trillions of dollars in chips and data centers. Many of these investments in the AI sector seem to be speculative and circular in nature. It remains to be seen whether this deal will solidify AMD's long-term role in AI or contribute to a speculative boom.
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