AMD's $60B Meta deal includes a 10% stock warrant
AMD has landed an agreement to supply Meta with up to $60 billion worth of AI chips over the next five years.
The deal also includes a warrant enabling Meta to acquire up to 160 million shares (about 10% of AMD) with a one-cent exercise price that vests over the deal only after AMD stock hits rising performance targets (up to $600) and other technical and commercial considerations—a big sign of trust between two tech giants.
AMD's stock jumped more than 10% after the news, and this follows a similar partnership with OpenAI, showing that AMD is becoming a serious player in the AI chip scene.
AMD chips to power Meta's AI models
AMD will deliver six gigawatts worth of chips, starting with their MI450 model (built for advanced AI tasks that Meta helped develop).
If certain goals are met, Meta gets access to 160 million AMD shares.
Still, Meta isn't putting all its eggs in one basket—they're also in talks with Google about using the company's tensor processors and building their own processors to keep their data centers running strong and avoid relying on just one supplier.