AMD Stock Soars After Inking a Huge AI Chip Deal With OpenAI.

Advanced Micro Devices (AMD) shares surged 24% to $203.71 after announcing a long-term deal to supply OpenAI with Instinct GPUs.

OpenAI plans to deploy 6 gigawatts of AMD Instinct GPUs, with the first 1 gigawatt deployment starting in the second half of 2026.

OpenAI received a warrant to purchase up to 160 million shares of AMD stock at 1 cent apiece, representing about 10% of total shares.

The size of the AMD deal with OpenAI suggests the chip maker will be the second-largest supplier of AI chips for the AI start-up.

AMD management said they expect the OpenAI partnership will enable the company to eventually generate tens of billions of dollars in annual revenue and over $100 billion in total revenue from selling chips over the next several years.

Barron's