Advanced Micro Devices (AMD) and OpenAI announced a multi-year partnership Monday 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 more than 30 percent before markets opened on news of the agreement that would see the company deliver six gigawatts worth of chips to the ChatGBT maker.
According to a joint statement, AMD will supply the California-based start-up with graphic processors units (GPUs) that are key to the development of artificial intelligence.
In late September, Nvidia and OpenAI signed a contract for more than $100 billion in equipment intended to increase OpenAI's generative AI capabilities.
Analysts say AMD is facing competition from - in addition to Nvidia - China's Huawei, as well as Amazon and Google.
Under the deal Monday, AMD will issue OpenAI 160 million "warrants" - a financial product that can be converted to shares under certain conditions.
