AMD Reaches Multibillion-Dollar Deal With OpenAI—As Shares Soar 30%

Topline

AMD stock soared as trading opened Monday morning, after the chipmaker announced a multibillion-dollar deal with OpenAI in a move that could challenge AI giant Nvidia, which earlier announced plans to acquire a stake in rival Intel.

OpenAI CEO Sam Altman and AMD Chair and CEO Lisa Su at a Senate Commerce Committee hearing on AI.

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Key Facts

OpenAI will acquire and deploy 6 gigawatts of AMD’s AI chips, starting with a 1-gigawatt deployment in 2026, both companies said in an announcement.

The chipmaker issued OpenAI a warrant for up to 160 million shares, representing an estimated 10% stake in AMD at $0.01 per share, which will be vested once specific share-price milestones are met, according to a regulatory filing by AMD.

Shares will be vested in multiple tranches and be tied to a rise in AMD’s stock price, which must triple to $600 for the final tranche, according to the filing.

Neither company’s announcement mentioned the exact value of the deal, but AMD noted that its partnership with the ChatGPT-maker is expected to deliver tens of billions of dollars in revenue for AMD.

The deal is AMD’s most significant win in its attempt to challenge Nvidia’s dominance in the AI chip market, and also helps OpenAI reduce its dependence on Nvidia’s GPUs.

How Has Amd’s Stock—and The Market—reacted To The Deal?

Shares of AMD increased by more than 30% to around $215 after trading opened Monday, pacing what would be the stock’s largest single-day gain since April 2016. AMD headlined a broader rally by the tech-heavy Nasdaq, which ticked up by 0.3%, with rises among Micron (6%), Palantir (4.9%), Intel (4%) and Tesla, whose shares rose 3% after the automaker released teaser footage of what appeared to be a new model. Nvidia dropped slightly (0.2%) following AMD’s announcement.

Forbes Valuation

AMD’s morning rally added about $241 million to CEO Lisa Su’s net worth, estimated at $1.4 billion following a 20.5% increase. Su, who previously had stints at Texas Instruments at IBM and Texas Instruments, joined AMD in 2012, became its chief executive in 2014 and was named a billionaire in 2024.

What Do We Know About Openai’s Deal With Nvidia?

Last month, Nvidia announced plans to invest $100 billion in OpenAI, which will allow the ChatGPT maker to deploy at least 10 gigawatts of Nvidia systems for its artificial-intelligence data centers to to “train and run its next generation” AI models. The first of these deployments is also scheduled to come online in the second half of 2026. However, unlike the Monday’s, this deal has not been finalized, as Nvidia and OpenAI have only signed a letter of intent.

Tangent

The big boost for AMD comes just weeks after two of its biggest rivals, Nvidia and Intel, announced plans to collaborate on new custom data center and consumer chips that combine Intel’s CPU and Nvidia’s GPU. As part of the deal, Nvidia said it will acquire around $5 billion worth of Intel’s shares. AMD’s shares dropped after this deal was announced as it threatened to dent a critical moat the company had over Nvidia. Only AMD and Intel are licensed to manufacture x86 chips, the architecture that powers most desktops, servers and laptops around the world. However, this deal opens the doors for Nvidia’s GPUs—used to power AI applications and graphically intense tasks—to be closely integrated with Intel’s x86 CPUs.