AMD Rockets on Landmark AI Partnership
AMD (NASDAQ: AMD) shares exploded higher on Monday, soaring 35% after announcing a historic multibillion-dollar deal with OpenAI — a move that could dramatically reshape the competitive landscape in AI hardware.
Under the agreement, AMD will supply over 6 gigawatts of GPUs to OpenAI across several generations, beginning with the company’s MI450 chips in the second half of 2026. The deal positions AMD as a major supplier in OpenAI’s long-term AI data center buildout.
OpenAI will also acquire up to 160 million AMD shares, equivalent to about 10% ownership, with shares vesting in tranches tied to performance milestones — including the delivery of AMD’s first 1 gigawatt of GPUs.
“Our partnership with OpenAI is expected to deliver tens of billions of dollars in revenue for AMD while accelerating OpenAI’s AI infrastructure buildout,”
said AMD CFO Jean Hu.
Hu added that the agreement will be “highly accretive” to AMD’s non-GAAP earnings-per-share and create “significant strategic alignment” for both companies.
AI Investment Arms Race Accelerates
The deal arrives just weeks after Nvidia (NVDA) revealed plans to invest $100 billion into OpenAI to advance its GPU-powered data centers. The AI startup, now valued at $500 billion, has become the centerpiece of a massive infrastructure boom that’s drawing billions from tech giants and institutional investors alike.
Last month, OpenAI also inked a $300 billion cloud infrastructure deal with Oracle (ORCL), further underscoring its aggressive expansion plans.
While AMD has long played second fiddle to Nvidia in AI hardware, the partnership with OpenAI signals a potential inflection point. AMD’s stock had only gained 1% over the past 12 months — compared to Nvidia’s 52% surge — but momentum has recently returned. Shares are now up 75% in the past six months, nearly matching Nvidia’s 84% gain over the same period.
AI Bubble or Long-Term Transformation?
The flood of capital pouring into AI continues to spark debate on Wall Street. Some analysts warn of overheated valuations, while others see a technological megatrend still in its early innings.
At Italian Tech Week, Amazon founder Jeff Bezos acknowledged signs of an AI bubble, but emphasized that the technology’s impact on industries and productivity will remain profound.
For AMD, however, this deal marks a tangible shift — one that brings revenue visibility, relevance, and credibility in the high-stakes race for AI supremacy.
WSA Take
AMD’s landmark deal with OpenAI could be the defining moment of its AI era. The partnership not only narrows the gap with Nvidia but also gives AMD a foothold in the world’s most valuable AI network.
In a market where infrastructure and chips are the new oil, AMD just found its next major growth engine.
If you missed our recent coverage on why gold mining stocks are crushing AI plays in 2025.
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