PULSE POINTS

❓WHAT HAPPENED: AMD has signed a multi-year deal to supply artificial intelligence (AI) chips to OpenAI, potentially generating tens of billions of dollars in annual revenue.

👤WHO WAS INVOLVED: AMD, OpenAI, and their respective executives, including AMD’s Forrest Norrod and OpenAI CEO Sam Altman.

Newsletter Need to Know.

Your free, daily feed from The National Pulse.

Thank You!

You are now subscribed to our newsletter.

📍WHEN & WHERE: The deal was announced recently and will begin generating revenue in 2026. OpenAI is based in San Francisco.

💬KEY QUOTE: “We view this deal as certainly transformative, not just for AMD, but for the dynamics of the industry.” – Forrest Norrod

🎯IMPACT: AMD’s shares surged by more than 34 percent, adding approximately $80 billion to its market value, while OpenAI secures critical AI infrastructure for future projects.

AMD has entered into a multi-year partnership with OpenAI to supply artificial intelligence (AI) chips, a deal that is expected to generate tens of billions of dollars in annual revenue. OpenAI, the creator of ChatGPT, will also have the option to acquire up to 10 percent of AMD, underscoring the significance of the agreement.

Shares of AMD soared more than 34 percent following the announcement, marking the company’s largest one-day gain in over nine years and adding $80 billion to its market capitalization. Forrest Norrod, AMD’s executive vice president, described the deal as “transformative” for both the company and the broader AI industry.

The agreement includes the deployment of AMD’s upcoming MI450 chips, with shipments beginning in the second half of 2026. These chips will power a one-gigawatt facility that OpenAI plans to build, with AMD estimating over $100 billion in new revenue over four years as a result of this and other customer agreements. Despite these advancements, analysts note that Nvidia remains the market leader in AI chips and continues to dominate the sector.

OpenAI CEO Sam Altman stated that the partnership with AMD will enable the company to meet its growing AI infrastructure needs. OpenAI has been exploring various avenues to secure enough computing power for its ambitious projects, which include developing its own silicon for AI use and partnering with other companies like Broadcom and Microsoft.

As part of the deal, AMD issued a warrant allowing OpenAI to purchase up to 160 million shares of AMD at a minimal price, contingent on achieving specific milestones. This structure could potentially allow OpenAI to influence AMD’s corporate strategy. Meanwhile, Nvidia‘s recent deal with OpenAI involves a $100 billion investment but does not include a stake in the company.

Image by FritzchensFritz.

Join Pulse+ to comment below, and receive exclusive e-mail analyses.