Meta Platforms and AMD have announced an expanded strategic partnership worth up to $100 billion over five years, in what represents one of the largest technology deals in history. The agreement will see Meta deploy up to 6 gigawatts of AMD Instinct GPUs across its AI data centers, fundamentally challenging Nvidia's near-monopoly on the AI accelerator chip market, which is valued at more than $200 billion.
Under the terms of the deal, Meta will begin purchasing AMD's latest MI450 chips starting in the second half of 2026. The first gigawatt deployment will utilize custom AMD Instinct MI450-based GPUs paired with 6th Generation AMD EPYC CPUs, codenamed Venice. This massive deployment underscores the scale of Meta's ambitions in artificial intelligence, with the company describing its overarching goal as building what it calls personal superintelligence.
As part of the agreement, AMD has issued Meta a performance-based warrant for up to 160 million shares of AMD common stock at a price of $0.01 per share. This effectively gives Meta the option to acquire up to a 10 percent stake in AMD. The warrant vests as chip shipment milestones are met, with AMD stock price targets rising as high as $600. The financial markets responded enthusiastically, with AMD shares jumping more than 9 percent in pre-market trading from a Monday close of $196.60.
The partnership is expected to significantly reshape the competitive landscape of the AI chip industry. Analysts project that AMD will grow its AI accelerator market share from roughly 9 percent in 2025 to over 15 percent by the end of 2026, driven largely by this deal. The agreement comes just days after Meta committed to deploying millions of Nvidia GPUs, signaling that the social media giant is actively diversifying its AI chip supply chain rather than relying on a single vendor.
Industry observers note that the deal represents a turning point for AMD, which has long operated in Nvidia's shadow in the AI accelerator space. The sheer scale of the partnership, combining massive chip orders with an equity component, creates a deeply intertwined relationship between the two companies. For Meta, the diversification strategy reduces supply chain risk and potentially gives the company greater leverage in negotiating future chip procurement deals.
The announcement also highlights the intensifying arms race among major technology companies to secure AI computing capacity. With demand for AI chips continuing to outstrip supply, companies like Meta are willing to commit extraordinary sums to ensure they have the hardware needed to train and deploy next-generation AI models. The $100 billion price tag places this deal alongside the largest corporate technology agreements ever negotiated, rivaling the scale of entire national infrastructure projects.
Comments