TLDR
- AMD and Meta announced a chip supply deal worth over $100 billion covering 6 gigawatts of AI computing power over five years.
- The agreement centers on AMD’s MI450 GPU, with the first gigawatt deploying in the second half of 2026.
- Meta could gain up to 10% of AMD stock through warrants priced at $0.01 per share.
- The deal includes custom AMD CPUs built specifically for Meta’s infrastructure.
- Meta will continue buying chips from Nvidia and other vendors alongside this agreement.
AMD and Meta Platforms announced a chip supply agreement Tuesday worth over $100 billion, covering 6 gigawatts of AI computing power across a five-year period.
The deal is one of the largest chip supply agreements ever announced and puts AMD more squarely in competition with Nvidia for Meta’s AI infrastructure budget.
Advanced Micro Devices, Inc., AMD
AMD’s MI450 GPU is the headline product. Meta had a hand in shaping its design, with the chip built to handle inference — the stage where an AI model processes and responds to user queries. Deployment of the first gigawatt is expected before the end of 2026.
AMD says each gigawatt of computing power represents several tens of billions of dollars in chip revenue.
Custom Silicon and CPUs
The agreement goes beyond GPUs. Meta will also purchase AMD CPUs, including a custom variant engineered specifically for Meta’s workloads, tuned for high performance at reduced energy consumption. Two generations of AMD CPUs are included in the deal.
AMD CEO Lisa Su said the arrangement reflects AMD’s push to lock in large customers for the long term.
“Meta has a lot of choices,” Su said. “I want to make sure that we are always a clear seat at the table when they think about what they need next.”
Warrant Structure Explained
As part of the deal, AMD is issuing Meta warrants to purchase up to 160 million AMD shares at $0.01 each. That equates to roughly 10% of the company.
The warrants vest in tranches tied to AMD’s rising stock price, with the final batch unlocking only if AMD hits $600 per share. AMD closed at $196.60 on Monday.
Each tranche also requires Meta to meet specific technical and commercial milestones.
The structure is nearly identical to AMD’s deal with OpenAI from late 2025. Both have drawn criticism as examples of “circular financing,” where two companies essentially pay each other in a loop.
Meta Keeps Multiple Chip Suppliers
Meta confirmed it is not relying solely on AMD. Last week, the company announced a separate deal to buy millions of Nvidia GPUs worth tens of billions of dollars.
Meta’s infrastructure head Santosh Janardhan said the scale of its data center buildout demands multiple chip vendors.
Meta spent $72 billion on AI infrastructure in 2025 and plans to spend up to $135 billion in 2026. CEO Mark Zuckerberg has outlined plans to deploy tens of gigawatts of computing power this decade.
Zuckerberg called AMD “an important partner for many years to come.”
AMD stock closed down 1.77% on Tuesday. Meta ended the session down 2.81%.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
