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U.S. technology titan Meta has agreed to buy up to $60 billion worth of artificial intelligence processors from semiconductor manufacturer Advanced Micro Devices (AMD) over five years, strengthening ties between the social media group and one of its key chip suppliers as demand for AI infrastructure grows.
The agreement includes the delivery of chips with a combined computing capacity of 6 gigawatts, with the first 1 gigawatt of AMD’s upcoming MI450 processors scheduled for shipment in the second half of this year, AMD Chief Executive Lisa Su said.
As part of the arrangement, AMD issued Meta a warrant that allows it to acquire up to 160 million shares at an exercise price of $0.01 per share, with shares vesting in stages tied to chip orders and performance thresholds.
The warrant structure could enable Meta to build a stake of around 10% in AMD over time, depending on order volumes and stock performance targets that extend to $600 per share. The warrant remains valid until February 2031.
Su described the structure as mutually beneficial, saying, "Meta is making a big bet on AMD, and we are also giving Meta a chance to participate if AMD shareholders do well."
AMD shares rose more than 10% in premarket trading following the announcement, after closing near $197 in the previous session.
Under the agreement, AMD will develop customized versions of its MI450 graphics processors and supply additional central processing units designed specifically for Meta’s data centers.
These processors will be optimized primarily for "inference," the stage where trained AI models generate responses and predictions in real-world applications. Meta also contributed to the MI450 chip design to better align with its computing needs.
Su said each gigawatt of computing capacity represented significant commercial value, noting that "from a financial standpoint, each gigawatt of compute is worth double-digit billions."
Santosh Janardhan, Meta’s head of infrastructure, said the company needs multiple chip technologies to support its growing AI workloads, explaining that "there’s a place for Nvidia, there’s a place for AMD and there’s a place for our own custom silicon as well."
Meta has been sharply increasing investment in AI infrastructure and previously raised $30 billion in a bond offering to help finance data center expansion.
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