OpenAI CEO Sam Altman and AMD CEO Lisa Su(r)|Steve Jurvetson; Fuzheado|CC BY 2.0; CC BY 4.0
OpenAI and Advanced Micro Devices (AMD) announced a multibillion-dollar deal to develop AI data centers powered by AMD chips, posing one of the strongest challenges yet to Nvidia’s market dominance.
The ChatGPT maker has committed to purchasing up to 6 gigawatts worth of AMD processors over the next few years, either directly or through cloud partners.
AMD expects the partnership to bring tens of billions of dollars in revenue by 2027.
Under the agreement, OpenAI will receive warrants for 160 million AMD shares, roughly 10% of the company, for one cent per share if certain deployment goals are met. AMD’s stock jumped 23.7% to $203.71 after the announcement.
OpenAI will use the chips for inference computing, which enables chatbots like ChatGPT to respond to users. CEO Sam Altman said AI demand is outstripping computer supply.
Despite Nvidia holding over 70% of the AI chip market, AMD’s deal marks a major step toward breaking its dominance amid an AI infrastructure boom.
However, given the number of deals in the space, there are concerns about an AI bubble.