AMD Shares Surge on OpenAI Deal, Nvidia Dips
AMD shares surged nearly 24% on Monday, following a deal with OpenAI. The partnership, which sees AMD supplying high-performance chips, is a significant boost for the company. Meanwhile, Nvidia's shares dipped by 1%.
The agreement involves AMD providing 6 gigawatts of computing power to OpenAI. This includes the latest Instinct MI450 graphics chips. The first batch, worth 1 gigawatt, is set for deployment in late 2026.
OpenAI CEO Sam Altman expressed excitement about the partnership, stating it will accelerate progress in AI. The deal also includes a warrant allowing OpenAI to buy up to 160 million shares of AMD's common stock, and an option to acquire up to a 10% stake in AMD.
Barclays analyst Tom O'Malley noted that Nvidia is a key competitor in providing computing capacity for AI infrastructure, making AMD's deal with OpenAI a notable achievement.
The AMD-OpenAI partnership is a significant step for AMD, which had previously lagged behind rival Nvidia. With OpenAI set to purchase a substantial portion of AMD's high-performance chips, AMD's future in AI infrastructure looks promising.
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