AMD Lands Major AI Chip Deal with OpenAI, Shares Surge

Sunnyvale, California — Advanced Micro Devices (AMD) announced on October 6, 2025, that it has secured a landmark agreement to provide OpenAI with hundreds of thousands of artificial intelligence (AI) chips. The deal, expected to generate tens of billions of dollars in revenue, marks a significant addition to AMD’s portfolio as one of OpenAI’s primary computing partners.

The partnership encompasses a staggering six gigawatts of AMD’s Instinct data center GPUs over several years, beginning in the latter half of 2026. This output is equivalent to the energy consumption of roughly five million U.S. households. Shares of AMD skyrocketed 27% in early trading on Monday, adding nearly $80 billion to the company’s market capitalization.

OpenAI plans to begin with a one-gigawatt facility constructed with AMD’s upcoming MI450 chips. According to OpenAI CEO Sam Altman, “This partnership is a major step in building the compute capacity needed to realize AI’s full potential.” He further emphasized that AMD’s advanced chip technology would help expedite the deployment of OpenAI’s AI models.

As part of the agreement, AMD has also offered OpenAI a warrant to purchase up to 160 million shares of common stock at a minimal price of $0.01 each, contingent on the achievement of specific performance milestones. Should OpenAI exercise the warrant fully, it will secure around a 10% ownership stake in AMD.

AMD’s CEO, Lisa Su, expressed enthusiasm about the collaboration. “We are thrilled to partner with OpenAI to deliver AI compute at massive scale,” she said in a statement, highlighting the potential this agreement has for both entities in the evolving AI landscape.

This significant commitment by OpenAI aims to mitigate its reliance on a single vendor, noticeably challenging Nvidia‘s market dominance. Following the announcement, Nvidia shares dipped 1.1%, showcasing how the new AMD partnership could reshape the competitive landscape in the AI market.

The deal has also positioned AMD to attract additional clients who may follow in OpenAI’s footsteps. AMD projects the new partnership will yield upward of $100 billion in revenue over four years, with the potential for continuous business growth as the AI sector expands.

Ongoing developments signal a burgeoning trend in the tech industry, as multiple companies strive to establish comprehensive infrastructures to cater to the growing demands of AI innovation.