AMD Inks Huge Instinct AI Chip Deal With OpenAI And A 10% Stake In The Company
AMD and OpenAI have come to terms on a multi-year agreement that will see OpenAI buy several generations of Instinct GPUs, as well as invest in a 10% stake in the Santa Clara chip designer. The bombshell announcement comes on the heels of Intel and NVIDIA teaming up in a partnership of their own that is worth several billions of dollars and involves co-developing data center and PC products.
After Intel and NVIDIA announced a $5 billion partnership, some speculated that AMD could be in big trouble. Those kind of hot takes proved premature, however, as the deal with OpenAI is a major one that will give AMD a cash infusion and a big client for AI chips for years to come. In a press release, AMD described the agreement as a "6-gigawatt agreement to power OpenAI's next-generation AI infrastructure."
The deal will begin in earnest in the second half of 2026, with the deployment of AMD's Instinct MI450 GPUs. AMD and OpenAI will strategically plan large-scale deployments of AMD's chips, including both Instinct MI450 series GPUs and rack-scale AI solutions through multiple generations.
"By sharing technical expertise to optimize their product roadmaps, AMD and OpenAI are deepening their multi-generational hardware and software collaboration that began with the MI300X and continued with the MI350X series. This partnership creates a true win-win for both companies, enabling very large-scale AI deployments and advancing the entire ecosystem," AMD says.
In a post on X, AMD said the deal puts its compute at the center of the global AI infrastructure build out. For sure, it's a massive opportunity for AMD. It's also a big deal for OpenAI, which is set to invest in 160 million shares of AMD in common stock when all is said and done. AMD and OpenAI are taking a staggered approach to the investment, with shares vesting upon achieving specific milestones.
"The first tranche vests with the initial 1-gigawatt deployment, with additional tranches vesting as purchases scale up to 6 gigawatts. Vesting is further tied to AMD achieving certain share-price targets and to OpenAI achieving the technical and commercial milestones required to enable AMD deployments at scale," AMD explains.
It should be noted that OpenAI also announced a $100 billion partnership with NVIDIA last month. As far as we know, that deal has not been officially consummated. Same goes for OpenAI's deal with AMD, though AMD labeled it as a "definitive agreement" in its announcement.
Today, we’re announcing a multi-year, multi generation strategic partnership with @OpenAI that puts AMD compute at the center of the global AI infrastructure buildout.
— AMD (@AMD) October 6, 2025
✅ 6GW of AI infrastructure
✅ Initial 1GW deployment of AMD Instinct MI450 series GPU capacity beginning 2H… pic.twitter.com/AVRgSePB0m
AMD has proven it can thrive as an underdog, having risen as such to challenge Intel in the x86 space under the leadership of CEO Dr. Lisa Su. In recent years, it can be argued that AMD surpassed Intel in process technology thanks to Zen. Intel still dominates in market share, both in consumer and data center markets, but more buyers than ever are turning to AMD.
That fight is ongoing, but there's also been a seismic shift in the landscape with NVIDIA becoming a dominant player in the AI chip space. NVIDIA's market cap is now over $4.5 trillion, and its ongoing investments in AI-capable GPUs is a large reason why.
AMD's deal with OpenAI is its biggest counter punch yet to NVIDIA's dominance in the space. It's also a major vote of confidence in AMD's chips, both now and into the future, and it comes at a time when NVIDIA is the darling of the AI industry. During a conference call to discuss the deal, Dr. Su said the deal has the potential to generate "well over $100 billion dollars" over the next several years. Dr. Su also said she believes AMD's data center business AI revenue can be tens of billions of dollars, with a "clear line of site" of achieving that metric by 2027.
The other interesting nugget from the conference call was Dr. Su saying AMD is having active conversations with a number of other customers that are very interested in its AI accelerators, paving a path for AMD to claim a "significant piece of the market as we go forward."
