Key Points
- Tech giants are inking a wave of multi-billion-dollar deals to secure their positions in the AI race.
- AMD has a new deal to supply chips to OpenAI, which includes an option for OpenAI to buy 10% of AMD.
- The need for massive computing power is driving huge cloud contracts, such as OpenAI’s reported $300 billion deal with Oracle.
- The $500 billion “Stargate” project highlights the immense scale of the investment in AI infrastructure.
The artificial intelligence boom has sparked a tidal wave of multi-billion-dollar deals as tech’s biggest players scramble to secure the chips, computing power, and talent needed to win the AI race. From chip supply and cloud contracts to massive new data center projects, the numbers are staggering.
Chipmaker AMD just announced a multi-year deal to supply AI chips to OpenAI. The agreement also gives the ChatGPT creator the option to buy up to 10% of AMD, a sign of just how closely the hardware and software sides of the AI world are becoming intertwined. This follows a similar, even larger plan by Nvidia to invest up to $100 billion in OpenAI.
The need for massive computing power is driving some of the biggest deals. Meta has signed a $14 billion agreement with cloud startup CoreWeave and is in talks for a $20 billion deal with Oracle. OpenAI has reportedly signed one of the largest cloud computing deals ever, agreeing to purchase $300 billion in computing power from Oracle over five years.
The chipmakers themselves are also making strategic moves. Nvidia is investing $5 billion in its rival Intel, while Japan’s SoftBank is injecting $2 billion into the struggling U.S. chip giant.
At the top of the pyramid is the massive “Stargate” project, a $500 billion joint venture between SoftBank, OpenAI, and Oracle to build the next generation of AI data centers. It all paints a picture of an industry in the middle of a historic gold rush, with companies betting their futures on securing a piece of the AI pie.
