In addition to purchasing artificial intelligence chips from Advanced Micro Devices, Facebook owner Meta Platforms will have the option to purchase up to 10% of the chip startup.
Days after Meta announced a long-term relationship in which it will use millions of Nvidia chips and other equipment for its artificial intelligence data centres, news of the AMD contract has surfaced.
AMD’s newest chips, the MI450, will be purchased by Meta to assist in powering data centres.
Shipments for the first gigawatt deployment under the 6-gigawatt agreement are scheduled to begin in the second half of this year. The potential value of the deal exceeds $100 billion.
AMD wants to keep up with Nvidia in the AI craze, which is generally considered to be the most significant technological breakthrough since Steve Jobs, the co-founder of Apple, invented the first iPhone.
From powering video games to assisting in the training of potent AI systems, such as the technology underlying ChatGPT and picture generators, Nvidia established an early lead in customizing its chipsets known as graphics processing units, or GPUs.
As more people started utilizing AI chatbots, demand surged. To create and operate them, tech corporations rushed to acquire more chips.
Although there is still a lot of demand for AI chips, some people are worried about how much businesses like Meta are spending on AI and whether they will be able to recoup their significant expenditures in the future through increased productivity and revenues.
Due to fierce competition from rivals like Google and OpenAI, the firm behind ChatGPT, Meta, has been working to resurrect its commercial AI initiatives.
The business hired Scale’s CEO, Alexandr Wang, to assist in overseeing a team creating “superintelligence” within the digital giant after investing $14.3 billion in the AI data company in June.
Additionally, Instagram’s owner, Meta, made a strong move to expand AI solutions across its platforms in December when it acquired the artificial intelligence firm Manus.
A performance-based warrant for up to 160 million shares of AMD’s common stock, valued at $0.01 each, was issued to Meta by AMD. The warrant is designed to vest upon the achievement of specific milestones.
As Meta’s purchases grow to six gigawatts, subsequent tranches will vest after the first tranche vests, with the first one gigawatt of shipments. AMD’s stock increased by almost 9% before Tuesday’s market opening.
