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Investing.com -- AMD shares jumped over 22% in early Monday trading after the company announced a multi-year agreement to supply artificial intelligence chips to OpenAI.
The deal is expected to generate tens of billions of dollars in annual revenue for Advanced Micro Devices and includes an option for OpenAI to acquire up to approximately 10% of AMD’s equity.
Under the agreement, AMD will supply hundreds of thousands of graphics processing units equivalent to six gigawatts over several years beginning in the second half of 2026. OpenAI plans to construct a one-gigawatt facility using AMD’s upcoming MI450 series chips starting next year, with AMD expecting to recognize revenue at that time.
The chipmaker projects the agreement will contribute to more than $100 billion in new revenue over four years from OpenAI and other customers.
"We view this deal as certainly transformative, not just for AMD, but for the dynamics of the industry," said AMD executive vice president Forrest Norrod.
OpenAI CEO Sam Altman stated the partnership will help the company build sufficient AI infrastructure to meet its requirements.