AMD shares surged 35% in early Monday trading after the chipmaker sealed a multi-year deal to supply advanced AI processors to OpenAI, the company behind ChatGPT.

This partnership, involving the deployment of up to 6 gigawatts of AMD Instinct GPUs starting in 2026, signals a major shift in the AI chip market and challenges Nvidia’s dominance in powering artificial intelligence infrastructure, CNBC reported.

This deal elevates AMD’s strategic position against longtime rival Nvidia. It promises significant GPU deployments over several years, with initial chips set to power OpenAI’s infrastructure starting in mid-2026.

A Strategic Win in the AI Chip Race

AMD announced a multi-year contract to provide its Instinct graphics processing units (GPUs) to OpenAI. The commitment spans up to 6 gigawatts of power, spread across multiple generations of AI hardware.

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The rollout begins with an initial 1-gigawatt deployment scheduled for the second half of 2026. The scale of this deal marks one of the largest GPU agreements in the AI sector and underlines AMD’s progress in closing the gap with Nvidia in AI accelerator technology.

As part of the agreement, AMD issued OpenAI a warrant to purchase up to 160 million shares at a nominal price. If fully exercised, this would translate to OpenAI owning close to 10% of AMD’s outstanding stock.

The shares vest incrementally as OpenAI scales its GPU usage to the 6-gigawatt target and meets key deployment milestones. OpenAI described the deal as worth billions, though it did not disclose exact figures.

Navigating a Circular AI Economy

This development follows OpenAI’s recent $100 billion equity and hardware supply deal with Nvidia, which covers 10 gigawatts for the broader AI infrastructure roadmap.

OpenAI’s chip purchases now come from multiple suppliers, Nvidia, AMD, and Broadcom, illustrating a tightly interconnected industry where capital, compute, and equity circulate among key players.

While Nvidia’s stock dipped slightly on the news, AMD’s shares rallied, reflecting confidence in its growing role. The partnership with OpenAI validates AMD’s Instinct GPU roadmap after years of Nvidia dominance in AI accelerators.

The partnership boosts AMD’s commercial prospects and diversifies OpenAI’s supply chain, reducing reliance on a single vendor and easing pressure on the industry’s hardware supply constraints.

OpenAI has already begun deploying Nvidia GPUs at its Texas site, with ongoing construction expanding capacity for future AI models. Adding AMD’s GPUs to the mix will help OpenAI meet its massive infrastructure goals, which have been estimated at nearly $1 trillion in buildout spending over recent weeks.

Source: Finance Magnates