OpenAI Strikes Major Deal with AMD for AI Chip Supply
Key Points
- OpenAI partners with AMD as a core strategic compute partner.
- Agreement includes up to six gigawatts of AI compute power.
- First gigawatt of Instinct MI450 GPUs to be deployed in the second half of 2026.
- OpenAI will purchase 160 million AMD shares at one cent each, potentially reaching a ten‑percent stake.
- Deal expected to generate tens of billions of dollars in revenue for AMD.
- Partnership diversifies OpenAI’s hardware sources beyond existing NVIDIA and Microsoft relationships.
OpenAI announced a strategic partnership with AMD to procure AMD's Instinct GPUs for large‑scale AI infrastructure. The agreement envisions deploying up to six gigawatts of compute power, with the first gigawatt slated for the second half of 2026. In addition to the hardware purchase, OpenAI will acquire 160 million AMD shares at a nominal price, potentially giving it a ten‑percent stake in the chipmaker. The deal positions AMD as a core compute partner and underscores OpenAI’s push to diversify its hardware sources beyond its existing relationships.
Deal Overview
OpenAI has entered into a multi‑year agreement with AMD that designates the semiconductor company as a core strategic compute partner. Under the terms, OpenAI will source AMD’s Instinct line of GPUs, specifically the MI450 model, to power a phased rollout of AI data centers. The plan calls for the deployment of up to six gigawatts of compute capacity, with the first gigawatt of Instinct GPUs expected to be installed in the second half of 2026.
Financial and Strategic Terms
Beyond the hardware commitment, the agreement includes a sizable equity component. OpenAI will purchase 160 million AMD shares at a price of one cent per share. These shares will vest over time as OpenAI meets defined milestones, beginning with the initial gigawatt deployment. If all milestones are achieved, the equity stake could rise to roughly ten percent of AMD’s outstanding shares, giving OpenAI a significant position in the chipmaker.
The partnership is framed as a mutually beneficial arrangement. AMD will provide the high‑performance compute needed for OpenAI’s next generation of models, while OpenAI’s adoption of AMD hardware is expected to generate "tens of billions of dollars" in revenue for the chipmaker over the life of the deal. Sam Altman, OpenAI’s co‑founder and chief executive, highlighted AMD’s leadership in high‑performance chips as a catalyst for accelerating AI progress and delivering benefits to a broader audience.
Context Within the AI Industry
This deal follows OpenAI’s earlier collaborations with other major technology firms. The company has previously partnered with NVIDIA to build a ten‑gigawatt AI infrastructure, and it maintains a substantial investment relationship with Microsoft, which holds a 49‑percent profit share. By adding AMD to its roster of hardware partners, OpenAI diversifies its supply chain and reduces reliance on a single vendor, positioning itself to scale its compute resources more flexibly.
AMD, for its part, sees the agreement as a validation of its Instinct GPU platform and a gateway to deeper involvement in the rapidly expanding AI market. The company’s commitment to providing large‑scale compute resources aligns with its broader strategy to compete directly with other AI‑focused chipmakers.
Future Outlook
The phased rollout of AMD‑based compute capacity will unfold over several years, with the initial deployment slated for late 2026. As OpenAI meets each milestone, additional share vesting will occur, potentially solidifying its influence within AMD. The partnership underscores a broader industry trend of AI leaders forging deep, multi‑faceted relationships with semiconductor manufacturers to secure the hardware needed for next‑generation artificial intelligence workloads.