AMD has signed a multi-year agreement to supply artificial intelligence (AI) chips to OpenAI in a deal projected to generate tens of billions of dollars in annual revenue for the chipmaker, Reuters has reported.

Under the partnership, OpenAI will deploy hundreds of thousands of AMD’s graphics processing units (GPUs) starting in the second half of 2026. The rollout will be centred on AMD’s upcoming MI450 series chips and supported by a one-gigawatt data facility built by OpenAI.

AMD executives said the collaboration could yield more than $100 billion in new revenue over four years when considering its wider market implications.

The agreement also includes an equity component, granting OpenAI an option to purchase up to roughly 10% of AMD’s shares. As part of the deal, AMD issued OpenAI a warrant to buy as many as 160 million shares at one cent each, with vesting linked to delivery milestones and stock performance targets.

The partnership positions AMD as a major competitor to Nvidia, which recently unveiled a large-scale AI hardware agreement with OpenAI. Industry analysts say the move could diversify the supply chain for AI computing infrastructure and reduce OpenAI’s dependence on a single chip provider.

OpenAI Chief Executive Sam Altman said the partnership would help the company meet rising demand for computing capacity as it expands its AI services.

Following the announcement, AMD’s shares surged to their largest single-day gain in more than nine years, adding about $80 billion to the firm’s market capitalisation.