AMD stock surged sharply in pre-market trading on Monday. Shares jumped 27% to $210 after the company announced a multibillion-dollar deal with OpenAI. The AI chip partnership is valued at around $10 billion and is expected to span multiple years. Investors reacted quickly, pushing the stock higher amid optimism about AMD’s role in AI infrastructure.
OpenAI will deploy up to six gigawatts of AMD Instinct MI450 GPUs over the coming years. The initial rollout of one gigawatt is scheduled for 2026. Analysts say this could generate tens of billions in revenue for AMD, boosting the company’s long-term growth prospects. OpenAI also secured a warrant to acquire up to 160 million AMD shares at a nominal price. If exercised, this could give OpenAI roughly a 10% stake in AMD, aligning the company’s success with AMD’s performance.
The market interpreted this deal as a major validation of AMD’s AI strategy. Nvidia has dominated the AI chip market for years, but OpenAI’s choice to partner with AMD signals growing competition. Experts believe this could gradually challenge Nvidia’s market share and influence. Investor sentiment is positive, and many see AMD’s technology as capable of supporting next-generation AI workloads at scale.
AMD stock is predicted to rise in the near term following its recent surge from the OpenAI deal announcement. For October 2025, forecasts show the stock starting at around $164 with a potential maximum price of $193 and an average price near $171, closing the month near $179, reflecting a 9.1% gain. Longer-term predictions suggest steady growth, with November’s forecast averaging around $185 and reaching $195 by the end of that month.
Analyst consensus and forecast models project continued upside driven by strong demand for AI infrastructure and AMD’s strategic partnerships, including the OpenAI deal. The stock is currently trading around $164.67 with some volatility, and the general outlook remains positive for the rest of 2025.
Some analysts caution that execution risk remains. Meeting deployment targets and production timelines for large-scale GPU orders is complex. Any delays or setbacks could temper investor enthusiasm. However, the overall market view is that AMD’s partnership with OpenAI positions it as a serious competitor in the AI chip space.
What sparked AMD’s massive stock surge?
Advanced Micro Devices (AMD) stunned investors this week as its stock surged more than 25% in pre-market trading, reaching $210.08 per share — its highest level ever. The rally came right after AMD announced a multibillion-dollar partnership with OpenAI, the company behind ChatGPT, marking one of the largest and most influential AI hardware deals to date. This collaboration positions AMD at the center of the growing AI revolution. Investors quickly reacted, viewing this deal as a turning point that could reshape the competitive landscape of the semiconductor industry.
In a single trading session, AMD added billions of dollars to its market capitalization, signaling how deeply the market believes in the potential of AI-driven growth.
AMD has long been seen as the closest competitor to Nvidia in the high-performance computing space. But with this deal, it’s not just competing — it’s securing a seat at the core of the AI infrastructure powering next-generation technologies.
What does the AMD-OpenAI deal include?
Under the new agreement, AMD will deliver up to 6 gigawatts of AI computing power to OpenAI over the next few years.
This massive supply will help OpenAI expand its infrastructure to support larger and more complex artificial intelligence models. The first 1 gigawatt is expected to be deployed in the second half of 2026, setting the stage for continued growth in AI research and product development.
In simpler terms, AMD will provide the high-performance chips that train and run AI systems — the same kind of technology used to power tools like ChatGPT.
As AI demand skyrockets worldwide, this partnership ensures OpenAI gets the compute power it needs while giving AMD a long-term revenue stream from one of the biggest names in technology.
Executives from AMD expect the deal could generate tens of billions of dollars in future revenue. That potential has made this announcement one of the most exciting developments in the tech sector this year.
Why did AMD give OpenAI a 10% stake option?
One of the most surprising parts of the deal is that OpenAI now holds a warrant to buy up to 160 million AMD shares, representing about a 10% ownership stake.
The option comes with a nominal exercise price — reportedly just one cent per share — but it only becomes valid once AMD meets specific performance and supply goals.
This structure ties OpenAI’s success directly to AMD’s growth. The better AMD performs in delivering on its commitments, the more OpenAI benefits financially.
It’s a rare form of partnership that goes beyond a typical supply contract — it creates a shared incentive for both companies to scale faster, innovate more, and expand their presence in the AI ecosystem.
For investors, this setup signals confidence from both sides. OpenAI’s willingness to take an ownership position shows strong belief in AMD’s technology and future. Meanwhile, AMD gains credibility as a trusted supplier capable of delivering at massive scale.
How does this deal affect AMD’s position in the AI race?
This partnership comes at a crucial time for AMD. For years, Nvidia has dominated the AI chip market, with its GPUs becoming the backbone of machine learning systems worldwide. But AMD has been steadily investing in AI hardware, particularly through its MI300 series GPUs, which are designed for high-efficiency, large-scale AI workloads.
Now, with OpenAI choosing AMD as a key partner, the company’s role in the global AI supply chain just became much stronger. The deal effectively positions AMD as an alternative to Nvidia for companies building advanced AI models and cloud infrastructure.
Investors are also viewing this as a strategic victory. AMD’s technology now has the opportunity to be deployed in one of the most demanding AI environments in the world — OpenAI’s data centers.
That exposure could help AMD attract more major AI clients in the coming years, expanding its influence far beyond the consumer and gaming markets where it’s been traditionally strong.
What are the risks and challenges ahead?
While the market reaction has been overwhelmingly positive, experts note that this deal comes with big challenges.
Delivering 6 gigawatts of AI compute capacity is an enormous task, requiring large-scale chip production, manufacturing expansion, and robust supply chain coordination.
Any delays or technical issues could impact revenue timelines and investor confidence.
Another concern is shareholder dilution. If OpenAI exercises its full warrant option, AMD will need to issue new shares, potentially reducing the value of existing ones.
However, analysts suggest the long-term benefits — including revenue growth and market positioning — outweigh the short-term dilution risk.
Still, success will depend on flawless execution. AMD must ramp up production, deliver high-performance chips on schedule, and maintain competitive pricing against Nvidia, which remains a dominant force in AI.
What does this mean for the future of AMD?
Analysts view this deal as transformative for AMD, positioning it as a stronger competitor against Nvidia in the AI infrastructure market. The partnership highlights AMD’s growing role in powering AI workloads, and investors have responded with enthusiasm given the long-term revenue potential.
OpenAI CEO Sam Altman emphasized the collaboration’s importance in scaling AI infrastructure, while AMD CEO Lisa Su expressed excitement about delivering compute at massive scale in AI development. The deal significantly enhances AMD’s growth outlook, leading to the sharp surge in stock price today.