At about the same time that Nvidia CEO Jensen Huang expressed surprise at OpenAI’s multi-billion dollar deal with rival AMD – shortly after his company agreed to invest up to $100 billion in the artificial intelligence model maker – Sam Altman said more such deals were on the way.
According to TechCrunch – OpenAI’s deal with AMD is unusual. AMD agreed to give OpenAI large stakes in AMD – up to 10% of the company’s stock over several years, depending on factors like stock price performance. In exchange, OpenAI will benefit from and help develop the chipmaker’s next-generation artificial intelligence GPU chips. This makes OpenAI an AMD shareholder.
Nvidia’s deal is the opposite. Nvidia invested in the artificial intelligence model-building startup and became a shareholder in OpenAI.
While OpenAI has been using Nvidia hardware for years through cloud providers like Microsoft Azure, Oracle OCI, and CoreWeave, “this is the first time we’re selling directly to them,” Huang explained, adding that his company will continue to supply hardware to cloud developers.
But Huang admits that OpenAI doesn’t “have the money yet” to pay for all of this gear. He estimated that each gigawatt of AI data center will cost OpenAI “$50 to $60 billion,” to cover everything from the land and power to the servers and equipment.
So far, OpenAI has launched 10 gigawatts worth of devices in the U.S. through 2025, under a $500 billion Stargate deal with partners Oracle and SoftBank. (It also signed a $300 billion cloud deal with Oracle.)
Its partnership with Nvidia was for at least 10 gigawatts of AI data centers. Its partnership with AMD was for 6 gigawatts. Plus its “Stargate UK” partnership involves expanding data centers in the U.K., and it has other European commitments. By some estimates, OpenAI has this year inked $1 trillion worth of such deals.
Sam Altman: expect more
When asked about these latest deals, Altman said, “You should expect a lot more from us in the coming months.”
Altman sees OpenAI’s future models and other upcoming products as much more capable, driving much higher demand, and “we decided it was time to invest very aggressively in infrastructure,” he explained.
The problem is that OpenAI’s revenue is currently nowhere near $1 trillion, although by all accounts it’s growing rapidly and is reportedly on track to reach $4.5 billion in the first half of 2025.
Altman, however, clearly believes that all of this investment will pay off in the end. “I’ve never been more confident about the research agenda that’s in front of us and the economic value that’s going to come out of these [future] models.”
So stand by, tech industry. OpenAI is still wheeling and dealing.
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