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AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake

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Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake

#201

Post by giancarlostoro »

cs702 wrote: post #64
giancarlostoro wrote: post #57

Earlier quoted context omitted.

My understanding from the more hardware savvy friends I have is that AMD is better for inference (so when you run a model) vs for training Nvidia is still king. Would be interesting if OpenAI does in fact take AMD's offer and how they use it (if they even share openly).

Today, yes, it's true that AMD hardware can be competitive mainly for inference. The story here is about the future . Over time, OpenAI would benefit if AMD hardware becomes competitive for training too. Nvidia currently gets to charge whatever the market can bear on its dominant training hardware. If AMD hardware becomes a real alternative for training, Nvidia will be forced to compete on price.

The reason I think its worth noting is that Inference is definitely what I imagine an insane amount of their computer is / will be spent on. I could see a very optimal setup where training is all Nvidia, but inference becomes reliant on AMD.

Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake

#202

Post by bwfan123 »

razoorka wrote: post #171

This whole thing looks like a bubble in slow motion. A “non-profit” that somehow buys stakes, signs multi-billion supply deals, and moves markets based on promises of future models — all while technically owning nothing tangible. They’re leveraging their own paper value to buy more paper value. It’s circular finance at scale: every deal increases the perceived valuation, which then becomes collateral for the next one…

What surprises me is the pace and size of these announcements. So many announcements so fast and each one at least 100B all involving openai. Reminds me of a quote by Chuck Prince - Citigroup CEO from 2008 - "As long as the music is playing, you've got to get up and dance"

Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake

#203

Post by Havoc »

grim_io wrote: post #7
BoredPositron wrote: post #3

I wonder what we will do with all that compute if no one is going to use it...even if we achieve AGI it won't run on this generation of hardware. Are we just gonna brute force architectures or wtf is going on?

Cheap cloud gaming. Those GPU's will finally push pixels again :)

They won’t. High end AI GPUs get stomped by mid tier gaming GPUs on pixels

There will definitely be takers though. Can see scientific community for example loving some cheap GPUs

Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake

#205

Post by giancarlostoro »

rvba wrote: post #137
giancarlostoro wrote: post #36

Earlier quoted context omitted.

Similar to how Microsoft bought out nearly half of OpenAI, though they offered compute credits IIRC. I wonder how much into Microsoft's investment OpenAI is in. Edit: Apparently what Microsoft owns is 49% profit-sharing interest in OpenAI, specifically in the 'capped profit' for profit subsidiary. So weird, but hey, it's still a slice of the pie. Plus they can exclusively sell access to the models.

Microsoft seems to have made a good deal: it got the models AND profits. Also microsoft is pushing copilot to office and I think it will sell. Since they sell to general B2B and not only to the peogrammer niche. AMD is trying to buy market share by donating 10% equity. I also think it is crazy

Yeah, I heard about when ChatGPT removed I think it was O4? apparently there's an entire community devoted to "role playing" or rather dating a character powered by the model. GPT5 broke their entire relationship. Me and a few friends agreed it might have been worth spinning up a dating GPT O4 based service for those people to pay to migrate their AI 'companions' to. Azure still has these "abandoned" models.

On the other note, it also helps OpenAI because they don't have to manage setting up all that infrastructure just to let others use the model.

Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake

#206

Post by aurareturn »

thiago_fm wrote: post #84
giancarlostoro wrote: post #57

Earlier quoted context omitted.

My understanding from the more hardware savvy friends I have is that AMD is better for inference (so when you run a model) vs for training Nvidia is still king. Would be interesting if OpenAI does in fact take AMD's offer and how they use it (if they even share openly).

For inference there are many solutions like groq. The margins there will be small. The fat margins is in training, in NVidia hardware.

Inference margins will be small(er) but it will be much bigger in market size than training.

That said, I'd much rather be leading in training than inference, of course. Nvidia still leads in inference, by the way.

Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake

#207

Post by programjames »

N70Phone wrote: post #89
yousif_123123 wrote: post #39

Earlier quoted context omitted.

I think at least part of the 10% is if AMD stock reaches 600. Not that I disagree that this looks weird. Why was that needed to be offered? Couldn't they just buy the AMD chips if they're good enough? Or Nvidia is it's better? I also don't get why there commiting so much to the future, are they sure of the quality of the products and their demand that much?

> I also don't get why there commiting so much to the future, are they sure of the quality of the products and their demand that much? It's one big game of musical chairs, and everyone can hear the phonograph slowing down. OpenAI is making these desperation plays because they've ran out of hype. GPT-5 "bombed", the wider public doesn't believe AI is going to keep getting exponentially better anymore. They're out of o…

I find it funny how people say GPT-5 "bombed". I noticed a significant improvement in maths and coding with GPT-5. To quantify were I've found the models useful:

- GPT 3.5: Good for finding reference terms. I could not trust anything it said, but it could help me find some general terms in fields I was unfamiliar with.

- GPT 4: Good for cached, obscure knowledge. I generally could trust the stuff it said to be true, but none of its logic or conclusions.

- GPT 4.5: Good for reference proofs/code. I cannot trust its proofs or code, but I can get a decent outline for writing my own.

- GPT 5: Good for directed thinking. I cannot trust it to come up with the best solution on its own, but if I tell it what I'm working on, it's pretty decent at using all the tricks in its repertoire (across many fields) to get me a correct solution. I can trust its proofs or code to be about as correct as my own. My main issues are I cannot trust it to point out confusion or ask me, "is this actually the problem we should be solving here?" My guess is this is mostly a byproduct of shallow human feedback, rather than an actual issue with intelligence (as it will often ask me at the end of spending a bunch of computation if I want to try something mildly different).

For me, GPT 5 is way more useful than the previous models, because I don't have a lot of paper-pushing problems I'm trying to solve. My guess is the wider public may disagree because it's hard to tell the difference between something better at the task than you, and something much better.

Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake

#209

Post by lesuorac »

wmf wrote: post #178
lesuorac wrote: post #98

Earlier quoted context omitted.

Not thin air. Existing AMD shareholders will have their holding diluted. Or assuming banks loan them money, if say OpenAI goes under then the banks just lose that money.

When the stock goes from $150 to $600 that's not called dilution. Nobody cares about the number of shares in that situation.

The CEO of Tesla, Elon Musk, was sued over an extremely similar situation. So somebody will care.

That said, this is really about the principal. Sure, if I give you $10 and you give me a hamburger it's not like some illegal transaction. But to say the $10 comes from thin air is wrong. It doesn't come from thin air.

I would bet that if one day OpenAI decided to sell 10% of AMD the stock would crash from $600 to below $150. IIUC, there's 1.6B shares of AMD while only 54M shares trade daily so dumping 160M shares would tank their price [1]. If AMD gives OpenAI 10% of the company and OpenAI goes under, it's going to take AMD's share price with it.

[1]: https://www.marketwatch.com/investing/stock/amd

Re: AMD signs AI chip-supply deal with OpenAI, gives it option to take a 10% stake

#210

Post by melenaboija »

Mistletoe wrote: post #191
melenaboija wrote: post #186

Earlier quoted context omitted.

The good part is that the next financial crisis when OpenAI sinks probably won’t be a systemic one, it will definitely drag others down and the stock market will readjust, but hopefully the US economy will remain afloat

Can you explain why you think that is? The SP500 has never been more top heavy and when those 7 or so all AI associated incest stocks falter I can't see anyway it's not going to be a bloodbath of the decade long type.

I don’t know, just intuition. Each crisis is different and impossible to predict, otherwise I’d be retired, which I’m not.

Completely agree, I’d expect all of those to take a big hit, and some more than others, but I don’t think Microsoft or Google would disappear. As for the SP issue, if this trend continues, people might start seeing the SP as the opposite of diversification (at least in the stocks market sense) and will have to start looking for something else.

BTW, I’m almost an all-in SP investor myself so I’ll have to navigate that dip too, lol

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