AMD Strikes Chips-for-Stock Deal With Meta to Challenge Nvidia

Advanced Micro Devices said Meta will buy billions of dollars worth of its chips to develop A.I. technologies and power new data centers, and that the social media company can take a financial stake of up to 10 percent as part of a multiyear agreement. AMD has used similar chips-for-stock deals, including one with OpenAI in October, as it tries to catch up with Nvidia in the market for artificial intelligence chips.

The move follows a wave of circular investments across the industry. Nvidia has invested billions in customers such as OpenAI, xAI and CoreWeave, while Microsoft, Google and Amazon have put money into OpenAI and Anthropic. Some investors question whether the pattern is inflating a bubble; Gil Luria of D.A.

Davidson said, "The cost of the A.I. build out is so high that these are the only companies that can fund it.

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