OpenAI just inked another multibillion-dollar deal.
The AI giant is buying 6 gigawatts and billions of dollars worth of Nvidia-rival chipmaker AMD’s latest generation chips to power its next-generation AI infrastructure.
AMD unveiled its next-generation Instinct chips at a launch event in July, when CEO Lisa Su took the stage with OpenAI CEO Sam Altman to announce that the AI giant would use the new chips.
The first 1 gigawatt of that deployment is set to begin in the second half of 2026. As OpenAI hits deployment targets, it will also gradually receive a total of 160 million AMD shares at 1 cent each, which translates to a roughly 10% stake in the chipmaker.
Nvidia is still the leader in the global chip industry, but AMD is its closest rival in the U.S., and Thursday’s deal gives the company a huge advantage in its efforts to compete.
The financials of the deal were not disclosed, but AMD chief financial officer Jean Hu said in the press release that the partnership was “expected to deliver tens of billions of dollars in revenue for AMD while accelerating OpenAI’s AI infrastructure buildout.”
Dealmaking is the name of the game
This is only the latest multibillion-dollar deal OpenAI has announced recently.
OpenAI and Nvidia announced a huge addition to their long-lasting partnership last month, with a $100 billion investment by Nvidia in OpenAI to support 10 gigawatts of data center and power capacity deployment. Just a few days prior to that, OpenAI also signed a $300 billion cloud deal with Oracle, which became one of the largest cloud contracts ever signed. Around the same time, OpenAI also inked a reportedly $10 billion deal with Broadcom to create custom in-house AI chips.
“Building the future of AI requires deep collaboration across every layer of the stack,” co-founder and President of OpenAI Greg Brockman said in a press release on Monday.
“We are in a phase of the build-out where the entire industry’s got to come together and everybody’s going to do super well,” Altman said, per WSJ. “You’ll see this on chips. You’ll see this on data centers. You’ll see this lower down the supply chain.”
The AI industry is a compact family affair. There are a handful of huge names with overlapping interests that ink a seemingly infinite series of multibillion-dollar investments with each other, injecting more money into the system and creating a self-sustaining network that props itself up… for now.
With each deal, the companies also enjoy a huge boost in share prices. On Monday morning, AMD’s shares skyrocketed more than 37% when news of the OpenAI deal hit the market.
The biggest players in AI are currently enjoying a ride on an unprecedented gravy train. Nvidia is the first and only company in the world to hit a $4.5 trillion market cap. Oracle’s chairman, Larry Ellison, was briefly the richest person in the entire world last month. OpenAI is now worth more on paper than Elon Musk’s SpaceX and TikTok parent company ByteDance.
But that also creates risk: if one company goes down, they all go down together, and that has only supercharged fears of an AI bubble for skeptics. If there is indeed an AI bubble, then a burst could have catastrophic consequences for the U.S. economy.