Meta Platforms has agreed to purchase potentially up to $100 billion worth of artificial intelligence chips from Advanced Micro Devices in a multiyear arrangement that could give the Facebook owner nearly 10% ownership of the U.S. semiconductor group.
The agreement covers processors capable of supporting about six gigawatts of data center power demand — equivalent to the electricity required by approximately 5 million U.S. households for one year. Deliveries will begin in the second half of this year with 1GW of AMD’s forthcoming MI450 hardware.
AMD will develop a customized version of its MI450 AI chips for Meta, primarily for inference workloads, which involve running models after training. The deal also includes AMD’s MI540 series GPUs and two generations of CPUs. Meta plans to purchase central processors, including a custom CPU variant designed to deliver strong performance while keeping energy consumption as low as possible.
As part of the transaction, AMD issued Meta a performance-based warrant for up to 160 million shares of AMD common stock — roughly 10% of the company — at an exercise price of $0.01 per share. The shares will vest in tranches tied to successive chip orders, with the first tranche scheduled to be delivered when the initial gigawatt ships later this year. The final tranche requires AMD’s share price to reach $600. The stock closed at $196.60 on Monday, and the warrant expires in February 2031.
AMD chief executive Lisa Su described the structure directly: “In some sense, Meta is taking a big bet on AMD, and we are also giving Meta a chance to participate if AMD shareholders do well.” She added that “each gigawatt of compute is worth double-digit billions” under the agreement.
Shares in AMD, which has a market capitalization of $320 billion, rose 14% in pre-market trading on Tuesday following the announcement.
The equity-for-chips structure mirrors a similar deal AMD reached in October with OpenAI, which was offered up to a 10% stake over time in exchange for processor commitments. Such arrangements have emerged as AI infrastructure costs have increased, prompting warnings about circular financing.
Meta’s purchase comes during a year when U.S. technology companies are expected to spend $660 billion on AI assets. The company has pledged to invest at least $600 billion in U.S. data centers and AI infrastructure over the coming years, including projected capital expenditures of up to $135 billion in 2026. In October, Meta raised $30 billion in its largest bond sale to date.
Construction is underway on a $27 billion data center in Louisiana, and Meta recently unveiled plans for a $10 billion gas-powered data center campus in Indiana designed for 1GW of compute capacity.
The agreement with AMD follows a multiyear deal between Meta and Nvidia to purchase millions of Nvidia’s CPUs and GPUs. Discussions have also taken place with Google about using its tensor processing units for AI workloads, according to Reuters. Meta continues development of its own in-house processors.
Santosh Janardhan, Meta’s head of infrastructure, said the scale of the company’s build-out requires multiple silicon solutions. He stated that there is “a place for Nvidia, there’s a place for AMD and… there’s a place for our own custom silicon as well. We need all three.”
Alvin Nguyen, an analyst at Forrester, said large AI companies reach a size where relying on a single supplier can limit growth. He pointed out that AMD’s chips perform as well as, and in some cases better than, Nvidia’s, and that AMD provides technologies enabling Nvidia workloads to run on its systems. He added that AI companies may eventually diversify further to other chipmakers such as Intel.
Last year, Meta pursued what was described as a “talent spending spree,” attempting to recruit leading AI researchers from rivals, at times offering signing bonuses of $100 million. Those efforts slowed amid widely reported fears of an AI bubble. Nguyen said Meta appears to be focusing on hosting AI infrastructure, including data centers.
New agentic AI tools have unsettled markets and contributed to a selloff in software stocks over concerns about job displacement. On Tuesday, Anthropic announced it will launch a plugin enabling its Claude Cowork tool to integrate with Google Drive, Gmail, DocuSign and other platforms. Kate Jensen, head of Americas at Anthropic, said the plugin will make the tool “more accessible and much more ready for anyone to be able to use.”
AMD has also taken part in financing arrangements tied to data center expansion. It helped Crusoe secure a $300 million loan from Goldman Sachs by offering a backstop guaranteeing use of its chips if customers are not found after installation at an Ohio facility.
