TLDR: OpenAI has entered a multi-billion dollar, multi-year agreement with AMD to deploy six gigawatts of AMD’s high-performance Instinct GPUs, starting in the second half of 2026. The deal includes an option for OpenAI to acquire up to a 10% ownership stake in AMD through warrants, contingent on performance milestones. This strategic partnership aims to significantly boost OpenAI’s AI computing capacity and intensify competition in the AI chip market, leading to a surge in AMD’s stock by over 30%.
In a significant development for the artificial intelligence and semiconductor industries, OpenAI and Advanced Micro Devices (AMD) announced a multi-billion dollar partnership on Monday, October 6, 2025. This multi-year agreement will see OpenAI deploy six gigawatts of AMD’s high-performance Instinct GPUs, beginning with the MI450 series chips in the second half of 2026. The collaboration is poised to be a direct challenge to Nvidia’s dominant position in the AI chip market.
As part of the transformative deal, AMD has issued a warrant granting OpenAI the ability to purchase up to 160 million shares of AMD common stock for 1 cent each. This equity option, representing roughly 10% of AMD, will vest in tranches as OpenAI achieves specific deployment and pricing milestones. The first tranche is set to unlock upon the completion of the initial one-gigawatt rollout.
AMD executives anticipate the deal will generate tens of billions of dollars in annual revenue for the chipmaker. Furthermore, due to the expected ripple effect across the industry, AMD projects over $100 billion in new revenue over the next four years from OpenAI and other customers. Following the announcement, AMD’s shares surged by more than 30%, adding approximately $80 billion to its market capitalization.
Forrest Norrod, AMD’s executive vice-president, emphasized the deal’s broader impact, stating, “We view this deal as certainly transformative, not just for AMD, but for the dynamics of the industry.” AMD CEO Lisa Su echoed this sentiment, highlighting the validation of the company’s Instinct chip roadmap and a significant commercial win. OpenAI CEO Sam Altman commented in a joint release, “AMD’s leadership in high-performance chips will enable us to accelerate progress and bring the benefits of advanced AI to everyone faster.”
This massive deployment of computing power underscores the AI industry’s “voracious appetite for computing power,” as companies race to develop advanced AI technologies. The six gigawatts of computing capacity are roughly equivalent to the energy needs of 5 million U.S. households or three times the annual electricity production of the Hoover Dam.
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This agreement follows closely on the heels of other major infrastructure commitments by OpenAI, including a reported $100 billion equity and chip supply deal with Nvidia for 10 gigawatts of AI data center infrastructure, and a $300 billion megadeal with Oracle for 4.5 gigawatts of cloud computing power. OpenAI is also reportedly developing its own in-house AI silicon in collaboration with Broadcom. These investments are part of OpenAI’s ambitious goal to reach a 23-gigawatt infrastructure, highlighting the immense capital expenditure required in the trillion-dollar AI infrastructure race. Despite generating approximately $4.3 billion in revenue in the first half of 2025, OpenAI has reportedly burned through $2.5 billion in cash, reflecting its aggressive investment strategy in talent and AI development.
