In a bold move set to reshape the artificial intelligence hardware landscape, OpenAI announced it will purchase 6 gigawatts of computing power from data centers powered exclusively by AMD chips—posing a serious challenge to Nvidia’s long-standing supremacy in the AI sector.
OPENAI DIVERSIFIES ITS CHIP SUPPLY AMID EXPLOSIVE AI GROWTH
Nvidia has dominated the AI chip market for years, driving its valuation to $4.6 trillion and earning the title of the world’s most valuable public company. However, OpenAI—known for its ChatGPT platform and the groundbreaking video generator Sora 2—is now diversifying its computing resources to meet skyrocketing AI demands.
The deal will deliver 1 gigawatt of power within the next year, followed by an additional 5 gigawatts built on future generations of AMD’s advanced Instinct processors. OpenAI plans to collaborate with AMD to develop new technologies and will make a significant financial investment to strengthen AMD’s chip production capabilities.
AMD shares soared 36% in premarket trading following the announcement, while Nvidia’s stock dipped by 2%. Industry analysts hailed the move as a major breakthrough for AMD. “This quickly brings Lisa Su and AMD right into the core of the AI chip spending cycle and is a huge vote of confidence from OpenAI and Altman,” said Dan Ives of Wedbush Securities.
A $26 BILLION PARTNERSHIP POWERING AI’S FUTURE
Under the agreement, AMD granted OpenAI a warrant for 160 million shares—worth more than $26.3 billion based on recent prices. These shares will vest over time as the companies meet specific goals, including technological milestones and performance targets tied to what AMD CEO Lisa Su described as “the world’s most ambitious AI buildout.”
OpenAI CEO Sam Altman praised the collaboration, calling it “a major step in building the compute capacity needed to realize AI’s full potential.” He added that AMD’s leadership in high-performance chips will “accelerate progress and bring the benefits of advanced AI to everyone faster.”
While the companies did not reveal the total value of the partnership, analysts expect it to generate tens of billions of dollars in revenue for AMD.
The deal also signals OpenAI’s strategic effort to reduce dependence on Nvidia, especially as demand for GPUs continues to outstrip supply. The partnership complements OpenAI’s recent agreements, including a $300 billion, five-year deal with Oracle for 4.5 gigawatts of data center capacity and a $10 billion collaboration with Broadcom to co-design AI chips.
AI INDUSTRY’S RAPID EXPANSION RAISES MARKET CONCERNS
Experts view OpenAI’s AMD deal as a logical expansion amid unprecedented AI growth. “AMD is another big player in this space, so this deal is a logical move from OpenAI and great news for AMD,” said Ben Barringer, global technology analyst at Quilter Cheviot.
The move also underscores how deeply AI investments have reshaped global markets. The eight most valuable companies—Nvidia, Microsoft, Apple, Google, Amazon, Meta, Broadcom, and Tesla—are all heavily invested in artificial intelligence, each exceeding $1.4 trillion in market capitalization.
Still, some analysts warn that the rapid rise of AI-related valuations could indicate an emerging tech bubble, fueled more by hype than sustainable performance. Despite those warnings, OpenAI’s AMD deal demonstrates that the race to secure computing power—and leadership in AI innovation—is only accelerating.
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