AMD Soars 25% After Shock OpenAI Deal: ChatGPT Maker Scores 10% Stake as Nvidia’s AI Reign Faces Its Biggest Threat Yet

AMD stunned markets Monday with one of the most consequential deals in its history— announcing a multi-year, multi-generational partnership with OpenAI that will see the ChatGPT creator deploy six gigawatts of AMD’s Instinct GPUs while receiving warrants that could give it up to a 10% ownership stake in the semiconductor company. The agreement, which AMD expects to generate tens of billions of dollars in incremental annual revenue once fully ramped, cements the chipmaker as a major player in the global AI infrastructure race—and immediately sent shockwaves through the broader semiconductor sector.

Under the terms of the deal, OpenAI will purchase hundreds of thousands of AMD’s upcoming Instinct MI450 GPUs beginning in the second half of 2026, with deployments expanding to six gigawatts over time. To align incentives, AMD has granted OpenAI warrants to buy up to 160 million AMD shares at one cent apiece, vesting in tranches tied to key deployment and performance milestones. The initial tranche will vest with OpenAI’s first 1-gigawatt deployment, while the final tranche will only vest once the full 6-gigawatt rollout is completed and AMD’s stock price reaches $600 per share. Vesting will also depend on OpenAI achieving specified targets for peak processing power—ensuring both companies deliver on scale, execution, and commercial success. If fully exercised, the warrants would give OpenAI roughly a 9-10% ownership stake in AMD based on current shares outstanding, an extraordinary arrangement that tightly links the companies’ long-term fortunes.

AMD shares exploded on the news, soaring as much as 25% in premarket trading and marking a new all-time high. At the same time, shares of AI rivals retreated sharply—Nvidia fell about 1.5%, Broadcom 2.7%, and Intel 1.5%—as investors digested the scale and symbolism of the partnership. For AMD, long considered the “number two” player behind Nvidia in the AI accelerator market, the OpenAI deal represents a massive validation of its Instinct architecture and a clear sign that customers are eager for alternatives to Nvidia’s dominant H100 and Blackwell chips. AMD CEO Lisa Su called the collaboration “a true win-win,” emphasizing that it will drive innovation across the AI ecosystem while being highly accretive to AMD’s earnings and long-term financial goals.

The partnership gives AMD what it has long lacked: a marquee customer capable of pushing its AI technology to global scale. By aligning with OpenAI—arguably the most influential company in the generative AI revolution—AMD gains guaranteed volume, deep technical collaboration, and credibility among hyperscalers and enterprise clients. OpenAI engineers will work closely with AMD to optimize upcoming Instinct GPU generations for large-scale inference workloads, helping the chipmaker advance toward its strategic goal of generating tens of billions in data center revenue by 2027. CFO Jean Hu said the partnership “creates significant strategic alignment and shareholder value,” and could ultimately drive over $100 billion in cumulative revenue in the coming years as additional customers build on the same AI infrastructure.

For OpenAI, the motivations are equally powerful. The company is racing to secure massive computing capacity to train and deploy its next-generation models amid severe global GPU shortages. The AMD partnership ensures a stable, diversified supply of high-performance chips at a scale previously only achievable through Nvidia. “It’s hard to overstate how difficult it’s become to get enough compute power,” said CEO Sam Altman. “We want it super fast, but it takes time.” Altman described the deal as “a major step in building the compute capacity needed to realize AI’s full potential,” adding that AMD’s leadership in high-performance chips would help OpenAI accelerate its expansion and make advanced AI “accessible to everyone faster.”

The warrant structure also gives OpenAI skin in the game. Each tranche incentivizes the company to meet technical and commercial milestones while tying its upside directly to AMD’s success. The final $600-per-share trigger for the last tranche underscores AMD’s confidence in the transformative potential of this partnership—a threshold that would more than triple the company’s current valuation. Analysts note the structure cleverly aligns both firms’ incentives while allowing AMD to benefit from future AI demand through broader ecosystem sales beyond OpenAI itself.

The deal’s ripple effects were immediate. Nvidia, whose chips dominate both AI training and inference markets, slipped premarket as investors recalibrated for AMD’s new competitive standing. Though Nvidia’s ecosystem remains far ahead, the AMD-OpenAI alliance introduces a credible alternative that could reshape procurement dynamics across the industry. Analysts say the partnership could erode Nvidia’s pricing power and accelerate diversification toward multi-vendor compute environments—especially as hyperscalers seek to avoid overreliance on a single supplier.

Beyond market share implications, the deal underscores a structural turning point in the AI hardware landscape. AMD’s steady climb with its MI300 and MI350 GPUs has positioned it as the most serious challenger to Nvidia’s supremacy. The OpenAI partnership now gives AMD a critical commercial platform to prove it can scale AI infrastructure profitably, reliably, and with ecosystem support. For AMD, the numbers speak for themselves: double-digit billions in new annual revenue potential, accretive margins, and a pathway toward more than $100 billion in AI-driven data center revenue in the coming years. For OpenAI, it’s a compute lifeline that secures the hardware backbone for its next wave of innovation.

If successful, this alliance could mark the moment AMD shifted from challenger to co-leader in the AI era—while giving OpenAI a critical edge in the global race to build artificial general intelligence.