AMD teams up with OpenAI to challenge Nvidia’s AI chip dominance

AMD is partnering with OpenAI to provide six gigawatts worth of processors for AI data centers, challenging Nvidia's AI chip market dominance. The five-year agreement aims to help OpenAI meet growing computational demands for AI applications like ChatGPT, starting with a gigawatt deployment of AMD Instinct MI450 GPUs in the second half of 2026. AMD expects the agreement to deliver "tens of billions of dollars in revenue" without providing specific details. The deal gives OpenAI the option to receive up to 160 million AMD shares, a roughly ten percent stake in the company, at a cent per share, "as specific milestones are achieved." The agreement follows OpenAI's "strategic partnership" with Nvidia last month, which would enable the ChatGPT-maker to deploy at least 10 gigawatts of AI datacenters with Nvidia GPUs. OpenAI previously described Nvidia as a "preferred strategic compute and networking partner" and AMD as a "core strategic compute partner." The deals with AMD and Nvidia come after OpenAI's exclusive partnership with Microsoft was adjusted in January, allowing OpenAI to make deals with other cloud providers for compute power. OpenAI and Microsoft are now on the verge of a new partnership, announcing a "non-binding memorandum of understanding" in September that could clear the way for OpenAI to eventually go public.