AMD Strikes Major AI Chip Deal with OpenAI, Offering Share Purchase Option
Key Points
- AMD will allow OpenAI to buy up to 160 million AMD shares at one cent each.
- The partnership adds roughly 6 gigawatts of AMD AI chip compute capacity over multiple years.
- OpenAI is diversifying its hardware supply, complementing existing Nvidia arrangements.
- Previous collaboration includes OpenAI’s input on AMD’s MI300X AI processor.
- OpenAI continues its own silicon development and maintains partnerships with Broadcom and Microsoft.
- The deal does not alter OpenAI’s broader compute strategy or existing vendor relationships.
AMD and OpenAI have entered a multi‑year agreement that lets OpenAI buy up to 160 million AMD shares at a nominal price while securing a substantial supply of AMD AI chips. The deal adds roughly 6 gigawatts of AMD‑based compute capacity to OpenAI’s growing AI infrastructure, complementing its existing relationships with Nvidia and its own silicon efforts. Industry sources say the partnership does not alter OpenAI’s broader compute strategy, including its work with Microsoft and Broadcom.
Deal Overview
AMD announced a new partnership with OpenAI that includes a unique financial component: OpenAI may purchase up to 160 million AMD shares at one cent per share over the life of the agreement. This share‑purchase option is tied to a broader commitment to provide AI‑focused silicon, allowing OpenAI to expand its compute capabilities while giving AMD a potential equity upside.
Compute Capacity Expansion
The agreement calls for the deployment of the equivalent of about 6 gigawatts of computing power using AMD’s AI chips over multiple years. This addition bolsters OpenAI’s strategy of diversifying its chip supply, ensuring that the rapid growth in demand for AI compute can be met through multiple hardware sources.
Context Within the AI Chip Market
OpenAI’s move comes as the company continues to broaden its hardware portfolio. Earlier, Nvidia announced an investment of up to $100 billion in OpenAI, which includes supplying at least 10 gigawatts of Nvidia systems and plans to deploy a gigawatt of its next‑generation Vera Rubin chips by late 2026. The AMD deal therefore adds another significant pillar to OpenAI’s compute strategy, complementing its existing Nvidia relationship.
History of Collaboration
OpenAI has a longstanding relationship with AMD, having provided input on the design of previous generations of AMD’s AI processors, including the MI300X. The new partnership builds on that history, extending cooperation into future hardware generations and larger scale deployments.
Broader Technology Strategy
Beyond external chip suppliers, OpenAI is also pursuing its own silicon development and has partnered with Broadcom on related initiatives. According to a source familiar with the matter, the AMD agreement does not change OpenAI’s ongoing compute plans, nor does it affect its partnership with Microsoft or its internal chip development roadmap.
Implications for Both Companies
For AMD, the deal secures a high‑profile customer and introduces a potential equity upside through the share‑purchase mechanism. For OpenAI, the partnership provides a diversified supply chain, additional compute capacity, and strategic flexibility as the AI industry continues to scale.