The deal marks a major endorsement of AMD's AI hardware and software capabilities as the company competes with Nvidia for dominance in the AI chip market. AMD executives project the agreement will generate more than $100 billion in new revenue over four years from OpenAI and other customers who follow OpenAI's lead.

AMD will supply artificial intelligence chips to OpenAI in a multi-year deal that would bring in tens of billions of dollars in annual revenue and give the ChatGPT creator the option to buy up to roughly 10% of the chipmaker.

Advanced Micro Devices is well-positioned for long-term growth, driven by its AI segment and recent OpenAI partnership. Learn more about AMD stock here.

OpenAI signed a deal in May to build out a one-gigawatt data center complex in the United Arab Emirates, a deal that was brokered by the Trump administration. Oracle, Nvidia, Softbank, Cisco and G42, a royals-backed Emirati AI company, are set to back the project.

The five-year agreement will challenge Nvidia’s market dominance and gives OpenAI 10% of AMD if it hits milestones for chip deployment.

AMD stock jumps 35% following announcement of major deal to supply 6 gigawatts of computing power through graphics processing units for OpenAI.

Nvidia CEO Jensen Huang said he was surprised that AMD would give away 10% of its company to OpenAI in their new partnership, calling the move "imaginative" but "clever," while emphasizing Nvidia's distinct direct-sales strategy with the ChatGPT maker.

OpenAI is committing to buying several generations of AI chips from AMD, in a long-term deal that could see it take a stake in the Nvidia rival.

OpenAI partners with semiconductor giant AMD to utilize next-generation graphics processing units for powering AI advancements.

The five-year deal will commit OpenAI to purchasing six gigawatts worth of AMD’s GPUs for its AI data centers.

If AMD stock hits certain price targets, OpenAI could own up to 10% of the company. CEO Lisa Su called the deal a “win-win” and said OpenAI’s commitment shows

International Business Machines Corporation (NYSE:IBM) is one of the Best Quantum Computing Stocks to Buy and Hold for 5 Years.