Chip giant AMD has recently announced a landmark multi-year chip supply agreement with leading artificial intelligence company OpenAI, which is expected to bring hundreds of billions of dollars in revenue for AMD and greatly accelerate its development momentum in the fast-growing AI industry.
According to the agreement, AMD will commit to providing OpenAI a total of **6 gigawatts (GW)** of computing power, sufficient to meet the electricity needs of up to 450,000 households, covering its entire line of Instinct GPUs, with the first products being the Instinct MI450 GPU. OpenAI expects to receive the first 1 gigawatt of computing power in the second half of 2026, at which time the new chips will be deployed as planned.
AMD claims that its upcoming MI450 series GPU will surpass Nvidia's comparable product Rubin CPX through hardware and software improvements, with many of these improvements incorporating OpenAI's input. Notably, AMD's current MI355X and MI300X series GPUs are already used by OpenAI for some workloads and have shown excellent performance in AI inference for large language models, thanks to their larger memory capacity and bandwidth.
As part of the agreement, AMD grants OpenAI an option to purchase up to 160 million shares of AMD stock, equivalent to 10% of the company's total shares. The shares will vest in batches: the initial batch will vest when the first 1 gigawatt of computing power is deployed, and the remaining shares will vest gradually as the power purchased by OpenAI reaches a total of 6 gigawatts. Notably, the final vesting of the shares is also tied to AMD's stock price - when AMD's stock price reaches $600 per share, the last portion of the shares will be fully vested. Affected by this transaction, AMD's stock opened at $222.24 on Monday, a rise of nearly 35% from the previous closing price.
This deal comes at a critical time for OpenAI as it actively seeks chip partners, aiming to build a large-scale AI infrastructure, including five new "Stargate" data centers with a planned capacity of 7 gigawatts. AMD Chairman and CEO Dr. Lisa Su stated that this collaboration is "the fusion of AMD and OpenAI's strengths, helping to achieve the world's most ambitious AI construction." OpenAI CEO Sam Altman also called this partnership "an important step in building computing power and fully realizing the potential of artificial intelligence."
This is the latest in a series of transactions OpenAI has made in recent weeks to secure computing power. Just last month, OpenAI reached a $100 billion investment and at least 10 gigawatts of power supply agreement with NVIDIA; signed a $10 billion custom AI chip development and manufacturing agreement with Broadcom; and reached agreements with Samsung Electronics and SK Hynix to procure DRAM memory chips for its "Stargate" project and establish data centers in South Korea. OpenAI's partnerships with Oracle and SoftBank are also expanding further.
