AMD to supply 6GW of compute capacity to OpenAI in chip deal worth tens of billions

AMD has entered into a groundbreaking multi-year agreement with OpenAI to supply an impressive 6 gigawatts of compute capacity, a deal anticipated to generate billions in revenue for the semiconductor company. This significant partnership is set to bolster AMD's position in the rapidly evolving AI market. The deal will see AMD deliver multiple generations of its Instinct GPUs, starting with the advanced MI450 GPU. OpenAI is expected to receive its first gigawatt of capacity in the latter half of 2026, coinciding with the deployment of this new chip. AMD asserts that the MI450 series will surpass Nvidia’s comparable products, thanks to enhancements made in collaboration with OpenAI. Currently, the MI355X and MI300X GPUs are already being utilized in various workloads for OpenAI, demonstrating exceptional performance in AI inference due to their substantial memory and bandwidth capabilities. As part of this strategic partnership, AMD has also granted OpenAI an option to purchase up to 160 million shares, which represents a 10% stake in the company. This initial stake will be activated with the first gigawatt deployment, with subsequent tranches linked to further purchases leading up to the full 6 gigawatts. The agreement ties OpenAI’s share acquisition to specific milestones in AMD’s stock price, with the final tranche vesting once shares hit $600. Notably, AMD’s stock has seen a significant surge, jumping nearly 35% following the announcement of this deal. As OpenAI continues to secure essential chip partnerships to enhance its AI infrastructure, this collaboration marks a pivotal advancement. OpenAI is also expanding its Stargate initiative with new data centers, aiming for a total capacity of 7 gigawatts. Dr. Lisa Su, AMD's CEO, expressed enthusiasm about the partnership, stating it combines the strengths of both companies to support ambitious AI development and enhance the broader AI ecosystem. OpenAI's CEO, Sam Altman, emphasized that this collaboration represents a vital step toward building the necessary compute capacity to unlock AI's full potential. This agreement is just one among several recent partnerships OpenAI has forged to solidify its position in the competitive AI landscape, including substantial investments and agreements with other tech giants like Nvidia and Broadcom.