Name: AMD Shares Soar After Signing Infrastructure Deal With OpenAI
Uploaded: 2025-10-08T04:56:43.000Z
Duration: 4 min
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OpenAI having such an outsized impact on this public market.

It signed a deal of a data center with OpenAI.

It could get a nearly 10% stake in the chip maker.

AMD expects the deal to lead to tens of billions of dollars in revenue.

And let's get more into that story on the AMD OpenAI News with Bloomberg Tech's Ed Ludlow.

I mean you have great command of the basic details, but there's a lot of unanswered questions.

So it's a multi-year agreement, six gigawatts of capacity, which is basically the peak energy demand of a sizable city.

The questions that remain is how is OpenAI going to finance this?

Because yes, in the structure, AMD issues OpenAI a warrant for 160 million AMD shares,

but they are deliverable in tranches against milestones that will require OpenAI to spend money.

So the first tranche of stock is deliverable on completion of the first gigawatt of capacity.

And what is not answered is, does OpenAI look to some other kind of financing mechanism to make this happen?

For AMD, it's a way of getting a bigger foothold on a market,

in which it is a distant number two, maybe even number three player behind Nvidia.

And so OpenAI, in this case, is their golden ticket to the inference-level compute that we think we'll need in the future.

And it's not just how do they finance this.

It's how do they finance everything that they've been announcing,

from deals with Nvidia to Coralweave to Oracle?

We are talking at least over $1 trillion.

The net commitment that OpenAI has to all of the parties you mentioned is somewhere between 26 and 30 gigawatts.

So the AMD 6 gig is a significant chunk of it.

You know, the question in this case is how is the structure of the AMD deal

different to the Nvidia-OpenAI deal, which had a value of 100 billion.

But so, the different mechanism where Nvidia basically gets a stake in OpenAI.

And we don't know whether Nvidia's commitment to OpenAI was cash or was it chips in lieu of cash.

That's what raised the circular financing questions

because Nvidia basically helps OpenAI to finance the purchase of Nvidia gear.

They are giving out stock to OpenAI once OpenAI spent the money.

What are they going to have to do in debt markets, for example,

on top of the other equity raises that they've done in the last 18 months?

But we will at least get an opportunity to ask that question.

Does this mean anything for some of AMD's competition?

When this was announced, Intel shares immediately fell.

They're back up. Nvidia shares and off all this morning.

So in the market for AI accelerators or high-performance GPUs, you know,

I think AMD would argue that this lets them fight back in some market share of a core player in the AI space.

We know that OpenAI, once the capacity is online, is going to use the AMD gear for inference,

in other words, running models as opposed to training them.

Does that signal to the market that AMD's technology is better at inference than in videos?

We don't know, but that's a reasonable question to ask.

Again, in the broader context of datacenter, the accelerators, but also CPU,

AMD is very small compared to what Nvidia is doing with a literal technical monopoly in this space.

So, you know, until the data center is built and it's not just sand and dirt in the ground, we won't know that.

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AMD Shares Soar After Signing Infrastructure Deal With OpenAI

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