AMD and OpenAI enter multi-billion dollar AI chip deal 

AMD has secured a multi-year agreement to supply AI chips to OpenAI in a deal expected to generate tens of billions of dollars in annual revenue for the chipmaker, as per a recent report by Reuters. The partnership includes an option for OpenAI to purchase up to approximately 10% of AMD's shares.

The arrangement involves deploying hundreds of thousands of AMD's graphics processing units (GPUs) beginning in the second half of 2026, with OpenAI building a one-gigawatt facility based on AMD's forthcoming MI450 series chips. AMD executives stated the deal could bring over $100 billion in new revenue over four years when accounting for its broader market impact.

As part of the agreement, AMD issued OpenAI a warrant to buy up to 160 million shares for one cent each, with vesting tied to shipment milestones and stock price targets. The deal positions AMD as a significant alternative to Nvidia, which recently announced its own substantial agreement with OpenAI.

OpenAI CEO Sam Altman stated the AMD partnership will help the company meet its growing AI infrastructure needs. Reuters adds that the announcement propelled AMD's stock to its largest single-day gain in over nine years, adding approximately $80 billion to its market value.