News Summary

AMD has announced a transformative multi-year agreement to supply AI chips to OpenAI, a deal valued at tens of billions of dollars annually. This agreement allows OpenAI, the creator of ChatGPT, to purchase up to 10% of AMD’s stock at a nominal price of 1 cent per share. The deal, spanning several years starting in the second half of 2026, includes hundreds of thousands of AMD’s AI graphics processing units. This strategic move is seen as a significant endorsement of AMD’s AI hardware and software, positioning the company to compete with Nvidia in the AI chip market. AMD executives anticipate over $100 billion in new revenue over four years from OpenAI and other potential customers following OpenAI’s lead. This partnership underscores a major shift in the industry dynamics, with AMD beginning to book income from the deal next year as OpenAI plans to construct a 1-gigawatt facility using AMD’s upcoming MI450 series chips.