Late last month, OpenAI announced a $100 billion agreement to use computer chips from Nvidia, the world’s most valuable publicly traded company.
Now, OpenAI has entered a similar agreement with AMD, one of the many chipmakers hoping to challenge Nvidia as the dominant supplier of chips used to power artificial intelligence technologies like OpenAIs ChatGPT.
On Monday, OpenAI said that it would begin using AMD chips in the second half of next year as it builds new computer data centers. The new facilities would be separate from the data centers OpenAI has committed to building in Texas, New Mexico, Ohio and a not-yet-named site in the Midwest.
Over several years, OpenAI plans to deploy enough AMD chips to consume 6 gigawatts of power, an amount that could supply all the households in Massachusetts. As part of its recent agreement with Nvidia, OpenAI agreed to deploy enough chips to consume 10 gigawatts.
AMD is not investing in OpenAI. But the agreement allows OpenAI to buy up to 160 million shares in the chipmaker at a penny per share, enough to give OpenAI a 10 percent stake in the chipmaker. It could also supply OpenAI with additional capital as it worked to build new computing facilities over the next several years.
The agreement is part of a wider effort among tech companies to spend hundreds of billions of dollars on the construction of new data centers. OpenAI, Amazon, Google, Meta and Microsoft plan to spend more than $325 billion combined on these facilities by the end of this year alone.
Tech giants like Amazon, Microsoft and Google, which pull in tens of billions of dollars in profits each year, have been able to finance data center construction with cash they have on hand. But as newer and smaller companies like OpenAI have built computing facilities, they have been forced to raise or borrow tens of billions of dollars.
Through its Stargate Project, OpenAI previously said it was working with the cloud computing company Oracle and the Japanese conglomerate SoftBank to spend more than $400 billion on new data centers in the United States. But the start-up and its partners do not have to money needed to pay for these data centers. So, it has looked for creative ways of bridging the financial gap.
In its recent deal with Nvidia, OpenAI agreed to deploy Nvidia’s chips. It also received a $100 billion investment from Nvidia. After investing an initial $10 billion in OpenAI, the chipmaker plans to invest an additional $90 billion in the company over the next several years. The agreement was the latest example of OpenAI raising money from the companies it relies on for products and services.
(The Times sued OpenAI and Microsoft in 2023 for copyright infringement of news content related to A.I. systems. The two companies have denied those claims.)
Cade Metz is a Times reporter who writes about artificial intelligence, driverless cars, robotics, virtual reality and other emerging areas of technology.
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