AMD’s stock soared to new heights on Monday as its groundbreaking deal with OpenAI promised a new and massive flood of revenue for the chipmaker. The multibillion-dollar partnership is expected to generate tens of billions of dollars annually, fundamentally altering AMD’s financial outlook.
The immediate reaction from investors was ecstatic, with the stock price jumping more than 30% and adding $80 billion to the company’s value. This reflects a strong belief that the deal is not just a one-time sale but the beginning of a long and incredibly lucrative relationship.
The revenue will flow from OpenAI’s commitment to purchase hundreds of thousands of AMD’s high-performance GPUs over several years. This provides a stable, predictable, and enormous income stream that will fuel AMD’s future research and development efforts.
Furthermore, AMD anticipates a secondary flood of revenue from other customers. The company projects that the prestige of the OpenAI deal will attract over $100 billion in new business over the next four years as other companies rush to adopt the same industry-leading technology.
The deal also includes a warrant for OpenAI to take a 10% stake in AMD, aligning their interests for the long term. This strategic element adds another layer of value, promising a future of close collaboration that is likely to create even more revenue-generating opportunities.
AMD’s Stock Soars as OpenAI Deal Promises a New Flood of Revenue
