AMD and OpenAI have announced a massive multi-year deal for AI GPUs. Exactly how many GPUs AMD will sell to OpenAI isn't clear, but the announcement says that if the arrangement comes fully to fruition, OpenAI will be running fully 6 gigawatts' worth of AMD Instinct GPUs. Intriguingly, the deal also includes OpenAI taking an up to 10% equity stake in AMD.
The first 1 gigawatt tranche kicks off in the second half of next year based on AMD's next-gen Instinct MI450 AI GPU. At the same time, OpenAI will acquire the first segment of up to 160 million AMD shares.
If the deal progresses right through to the final 6 gigawatt GPU power figure, OpenAI will by then have bought 160 million AMD shares accounting for roughly 10% of the company. At current values, that would be a $26 billion investment. So, it's a megabucks deal all round.
It also the first really big AI GPU win of this kind for AMD, at least that we are aware of. It looks like it's big news too for the markets, as AMD's share price rocketed up 35% on the news during early trading. Kerching!
It's yet another good news item for AMD in stark contrast to Intel's ongoing trials and tribulations. It's also the first time that AMD's GPUs for AI training and inferencing have looked like they're competing really squarely with the market monster that is Nvidia.
As for what it means for poor old PC gaming, well, the good news is that it helps AMD be even more successful and profitable, so it should have plenty of spare cash to develop new gaming GPUs.
The bad news is that it pulls the company's revenue streams even further away from the traditional PC market. Still, we'll take this as a win and probable good news for the PC.
AMD says it is unifying its RDNA gaming and CDNA AI GPU architectures into the. the single UDNA architecture. That means AI GPU successes and invest are more closely correlated than ever with gaming GPUs.
And it really should mean that AMD can take on not just Nvidia's AI GPUs directly, but its gaming GPUs, too.
