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Luke Kawa

AMD soars after striking megadeal with OpenAI that “is expected to deliver tens of billions of dollars in revenue”

OpenAI’s cash burn makes the investing world go ’round, and today, makes shares of Advanced Micro Devices go way up.

The chip designer is surging after being the latest to strike a pact with the Sam Altman-led venture to accelerate the AI build-out, which AMD CFO Jean Hu said “is expected to deliver tens of billions of dollars in revenue.”

The deal will see AMD sell multiple generations of its flagship GPUs to OpenAI, powering 6 gigawatts of its AI infrastructure. The first deployment is slated to start in the second half of 2026.

AMD’s AI GPU sales are expected to total $6.56 billion in fiscal 2025 and $10.26 billion in fiscal 2026 — and that latter figure is likely heading higher as analysts adjust estimates following this announcement.

This accord “quickly brings Lisa Su and AMD right into the core of the AI chip spending cycle and is a huge vote of confidence from OpenAI and Altman,” wrote Wedbush Securities analyst Dan Ives. “Any lingering fears around AMD should now be thrown out the window as this gives them a major platform to monetize the AI Revolution.”

The deal also marks the latest in a recent series of aggressive steps from OpenAI to amass computing power for the AI boom, including massive agreements with Broadcom and Oracle. To make good on these pacts will likely require equally aggressive moves from OpenAI to raise capital through private markets or, potentially, an IPO down the road.

Shares of Nvidia, the leader in AI GPUs, turned from positive to negative after this deal was announced.

As part of this agreement, AMD has issued warrants to OpenAI that enable the ChatGPT developer to receive 160 million shares, or about 10% of the company, if certain operational and stock price targets are hit over time.

“This partnership brings the best of AMD and OpenAI together to create a true win-win enabling the world’s most ambitious AI build-out and advancing the entire AI ecosystem,” AMD CEO Lisa Su said.

“AMD’s leadership in high-performance chips will enable us to accelerate progress and bring the benefits of advanced AI to everyone faster,” added OpenAI cofounder and CEO Sam Altman.

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Tasha Matsumoto
12h
S&P 500 closes lower after notching new intraday high

The Nasdaq 100 eked out a small gain, while the Russell 2000 fell.

CHICAGO, ILLINOIS - NOVEMBER 17: Mascot Staley Da Bear of the Chicago Bears runs onto the field prior to an NFL football game against the Green Bay Packers at Soldier Field on November 17, 2024 in Chicago, Illinois.
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Matt Phillips

Blackstone and Invitation Homes get hammered as Trump calls for ban on Wall Street buying single-family homes

Shares of Blackstone and Invitation Homes dove early Wednesday afternoon after President Trump called on Congress to pass a law banning large institutional investors from buying single-family homes.

Blackstone and Invitation Homes are some of the largest owners of private homes in the country. Homebuilders including PulteGroup, DR Horton, and Lennar also stumbled on the news.

Nationwide, institutional investors own a small share — less than 1%, according to the right-leaning American Enterprise Institute — of US single family homes, which has led some to argue that they have had a relatively small impact on housing prices. But their concentration in particular markets, such as Atlanta, Dallas, Houston, and Charlotte, has prompted others, like center-left think tank Third Way, to argue that their purchases can have an effect on specific markets, neighborhoods, or certain types of houses.

Donald J. Trump (@realDonaldTrump)

Blackstone and Invitation Homes are some of the largest owners of private homes in the country. Homebuilders including PulteGroup, DR Horton, and Lennar also stumbled on the news.

Nationwide, institutional investors own a small share — less than 1%, according to the right-leaning American Enterprise Institute — of US single family homes, which has led some to argue that they have had a relatively small impact on housing prices. But their concentration in particular markets, such as Atlanta, Dallas, Houston, and Charlotte, has prompted others, like center-left think tank Third Way, to argue that their purchases can have an effect on specific markets, neighborhoods, or certain types of houses.

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Matt Phillips

Intel surges amid CES announcements, Mobileye news

Intel surged to a new 52-week high in early trading, though it gave back a large chunk of the early gains by the afternoon. There were few headlines that could clearly explain the run-up of gains, which peaked around 11%.

One potential driver of the move might be optimism surrounding the company’s unveiling of a new line of processors at the Consumer Electronics Show on Tuesday.

Another possible candidate was the reflected glow of a deal announcement from Mobileye, the autonomous driving company that Intel holds a significant stake in.

Mobileye initially rose after buying Mentee — an artificial intelligence robotics company — for $900 million in cash and stock in a deal that’s expected to close this quarter.

(Intel spun off Mobileye in 2022, but retained a controlling stake in the company.)

Finally, news that Qualcomm is perhaps looking to use contractors outside Taiwan for its next-generation chip — though it’s reportedly speaking to Korea’s Samsung for that, not Intel — may be raising hopes that chipmakers looking to diversify away from Taiwan could become customers for Intel’s troubled contract chipmaking division.

But again, there’s no clear reason to point to for its outperformance on Wednesday.

Mobileye Acquires Startup Mentee Robotics for $900 Million

Mobileye Acquires Startup Mentee Robotics for $900 Million

Mobileye initially rose after buying Mentee — an artificial intelligence robotics company — for $900 million in cash and stock in a deal that’s expected to close this quarter.

(Intel spun off Mobileye in 2022, but retained a controlling stake in the company.)

Finally, news that Qualcomm is perhaps looking to use contractors outside Taiwan for its next-generation chip — though it’s reportedly speaking to Korea’s Samsung for that, not Intel — may be raising hopes that chipmakers looking to diversify away from Taiwan could become customers for Intel’s troubled contract chipmaking division.

But again, there’s no clear reason to point to for its outperformance on Wednesday.

Toby Bochan
16h
Managing futures risk: Understanding how much you stand to make or lose

The leverage futures offer can cut both ways.

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Luke Kawa
US-AI-SCIENCE-NVIDIA

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