OpenAI could acquire 10% of AMD trough multi-year partnership on AI chips

AMD and OpenAI announced a multi-year partnership for the supply of AI chips on Monday, which opens up the possibility for OpenAI to acquire an approximately 10 percent stake in the chip manufacturer. It was only recently made public that AMD’s major competitor Nvidia wants to invest up to 100 billion dollars in OpenAI. AMD has a market capitalization of approximately 267 billion dollars – ten percent of that is worth almost 27 billion dollars as of today.

The agreement stipulates that OpenAI will deploy a total of 6 gigawatts of AMD Instinct graphics processors across multiple years and GPU generations. The first phase with 1 gigawatt of AMD Instinct MI450 Series GPUs is scheduled to begin in the second half of 2026.

Stock Options as a Strategic Component

As part of the agreement, AMD has issued OpenAI warrants for up to 160 million AMD shares. The exercise of these options is tied to several milestones:

• The first tranche becomes due with the initial 1-gigawatt implementation
• Further tranches follow upon scaling up to 6 gigawatts
• Additionally, the options are tied to specific AMD stock price targets
• OpenAI’s technical and commercial milestones must also be achieved

Upon full exercise of the warrants, OpenAI would hold approximately 10 percent of AMD’s shares based on the current number of outstanding shares.

AMD Stock Rose Steeply in Pre-Market Trading

AMD’s stock price rose by nearly 27 percent in pre-market trading on Monday. AMD CFO Jean Hu stated that the partnership is expected to generate “tens of billions of dollars in revenue” for AMD and is “highly accretive” to the company’s non-GAAP earnings per share.

The agreement positions AMD as a core strategic partner of OpenAI and represents one of the largest GPU supply agreements in the AI industry. For AMD, the partnership means strengthening its position against market leader Nvidia, which dominates the AI chip market.

“This partnership is an important step in building the computing capacity needed to realize the full potential of AI,” said Sam Altman, co-founder and CEO of OpenAI. AMD CEO Lisa Su called the collaboration a “true win-win situation.”

Context within OpenAI’s Infrastructure Strategy

The AMD agreement fits into OpenAI’s comprehensive infrastructure strategy. The company had recently concluded a 100-billion-dollar deal with Nvidia, which covers 10 gigawatts of the total planned 23-gigawatt infrastructure. Together with the AMD partnership, the commitments add up to an estimated one trillion dollars in new infrastructure spending within two weeks.

OpenAI is also conducting talks with Broadcom about developing custom-designed chips for the next model generation. Diversifying suppliers could reduce dependence on individual vendors and mitigate supply chain bottlenecks.

The first AMD-powered facility is planned to be built as part of OpenAI’s Stargate project, with additional locations planned in New Mexico, Ohio, and the Midwest.