OpenAI signs multi-billion dollar chip deal with AMD

AFP | New York

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OpenAI signed a multi-year partnership Monday with chipmaker Advanced Micro Devices as the ChatGPT-maker continues an investment spree to secure massive amounts of computing power for rolling out generative artificial intelligence.

The companies announced the plan to develop AI data centers that the chipmaker said would bring in tens of billions of dollars in new revenue over the next five years.

AMD's share price surged 35 percent when markets opened on news of the agreement that would see the company deliver six gigawatts worth of chips to the ChatGPT-maker.

OpenAI sits at the center of an AI investment bonanza to power the promised artificial intelligence revolution.

It oversees the Stargate project, which has secured $400 billion of the $500 billion planned by 2029 for giant data centers in Texas, New Mexico and an undisclosed site in the US Midwest.

The deal with AMD follows a contract with Nvidia for more than $100 billion in equipment intended to increase OpenAI's generative AI capabilities.

Nvidia's graphics processing units (GPUs) are by far the dominant player in the AI field, with its products integrated into the company's software ecosystem, making it harder for rivals to compete.

"This is all incremental to our work with NVIDIA (and we plan to increase our NVIDIA purchasing over time). The world needs much more compute..." wrote OpenAI CEO Sam Altman on X.

California-based AMD generates the bulk of its revenue from CPU sales -- processors used for personal and business computers that are less powerful than GPUs.

Data server giant Oracle saw its share price skyrocket by 35 percent last month when it announced its own deal with OpenAI. OpenAI also signed a chip deal with South Korea's Samsung and SK Hynix.