Advanced Micro Devices (AMD) has finalized a significant supply agreement with Meta Platforms, committing to sell up to $60 billion worth of artificial intelligence chips over five years. This deal allows Meta to acquire as much as 10% of AMD's chip production capacity.
The agreement highlights the immense demand for AI processors. Meta will receive AMD's forthcoming MI450 flagship hardware, starting with one gigawatt in the latter half of this year, alongside central processors (CPUs). A customized CPU variant will be developed to optimize performance while minimizing energy consumption.
AMD CEO Lisa Su stated that Meta's CEO Mark Zuckerberg has ambitious goals, and AMD aims to support these through its technology. Meta contributed to the MI450 design, which is optimized for AI inference - the process enabling chatbots like ChatGPT to respond to user queries.
Industry analysts predict the inference hardware market will surpass the market for building large AI models. As part of the deal, AMD will issue Meta a warrant for 160 million shares, subject to performance targets and commercial considerations. Shares of AMD closed at $196.60 previously. Meta intends to continue sourcing chips from multiple vendors and developing its internal processors.