On Monday, OpenAI and semiconductor manufacturer AMD revealed that they have entered into a multi-billion dollar agreement concerning chips, which will allow the creators of ChatGPT to purchase significant equity stakes in the chipmaker.

This arrangement provides OpenAI the chance to acquire 10% of AMD, reflecting substantial confidence in the company’s AI chips and software. Following the announcement, AMD’s stock soared by over 30%, contributing approximately $800 billion to its market capitalization.

“We are excited to announce our dedication to delivering a variety of services to our clientele,” stated Forest Norod, AMD’s Executive Vice President.

These recent investment commitments underscore OpenAI’s significance, as the increasing demands of the AI sector drive companies to advance AI technologies that rival or surpass human intelligence. OpenAI’s CEO, Sam Altman, pointed out that the primary limitation on the company’s expansion is access to computing resources, particularly extensive data centers equipped with advanced semiconductor chips. Last week, Nvidia declared a $100 billion investment in OpenAI, further solidifying the collaboration between these leading AI firms.

The agreement announced on Monday encompasses the deployment of hundreds of thousands of AMD AI chips or graphics processing units (GPUs) totaling 6 gigawatts over several years, starting in the latter half of 2026. AMD confirmed that OpenAI will establish a 1 Gigawatt facility utilizing the MI450 series chips beginning next year.

Additionally, AMD issued a warrant that enables OpenAI to purchase up to 160 million shares of AMD at just one cent each during the course of the chip trading.

AMD’s executives anticipate that this transaction will result in tens of millions of dollars in annual revenue. Due to the expected ripple effects of this contract, AMD has projected more than $100 million in new revenue over four years from OpenAI and other clientele.

“This marks a trailblazing initiative in an industry poised to significantly influence broader ecosystems, attracting others to join,” remarked Matt Hein, AMD’s Head of Strategy.

This agreement with AMD is expected to significantly bolster OpenAI’s infrastructure to fulfill its operational requirements, Altman confirmed in a statement.

However, it remains unclear how OpenAI plans to finance this substantial deal with AMD. According to media reports, the deal is estimated to be worth around $500 million, yielding approximately $4.3 billion in revenue in the first half of 2025 while burning through $2.5 billion in cash.