Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

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

reuters.com

Post reply on HN
Print view View original

211–220 of 390 posts

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

#211

Post by zerosizedweasle »

yousif_123123 wrote: post #39
nerdix wrote: post #10

The title didn't make this obvious (at least not to me) but it's OpenAI that has the option to buy 10% of AMD. Not the other way around. In case you're wondering how OpenAI could afford to buy 10% of AMD while they are hemorrhaging money -- the terms of the deal allows OpenAI to buy 160 million shares at 1 cents a share. I could be thinking about this the wrong way but it appears that AMD is basically subsidizing the…

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?

This is too top of the top to ignore. Everyone can see the scam now, it's a joke

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

#213

Post by aurareturn »

theli0nheart wrote: post #34
john-h-k wrote: post #22

Earlier quoted context omitted.

It’s quite specifically not money printing, because it’s backed by something. It could be bad sure but it’s not money printing

Backed by what?

Ownership in a company.

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

#214

Post by buyucu »

amacbride wrote: post #184

I do hope that this leads to improvement in the HIP/ROCm software ecosystem. It’s definitely lacking in stability and polish compared to what NVIDIA has built. (Ask me why I’m on my third rebuild of LAMMPS this morning…)

HIP/ROCm is waaay better than it was a few years ago. It took a very long time, but AMD finally learned the importance of software.

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

#215

Post by zerosizedweasle »

rhetocj23 wrote: post #74
AlanYx wrote: post #68

Earlier quoted context omitted.

>Couldn't they just buy the AMD chips if they're good enough? OpenAI would presumably need to raise money to buy the AMD chips. The "genius" of this deal is that AMD is "giving away" 10% of the company (at $0.01/share) to OpenAI. Then OpenAI will presumably turn around and sell those shares (or borrow against them) to raise enough money to purchase the AMD GPUs.

Financing made out of thin air. Hilarious

It's a joke that it is so obvious what they are doing.

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

#216

Post by kalap_ur »

Aurornis wrote: post #165
AlanYx wrote: post #68

Earlier quoted context omitted.

>Couldn't they just buy the AMD chips if they're good enough? OpenAI would presumably need to raise money to buy the AMD chips. The "genius" of this deal is that AMD is "giving away" 10% of the company (at $0.01/share) to OpenAI. Then OpenAI will presumably turn around and sell those shares (or borrow against them) to raise enough money to purchase the AMD GPUs.

> The "genius" of this deal is that AMD is "giving away" 10% of the company (at $0.01/share) to OpenAI. There's no giving away of anything in the deal. The $0.01 per share price is only available if they purchase the GPUs. It's more like one of those "free with purchase" deals where you're still paying for the product, but they throw in something to sweeten the deal. They're not actually getting AMD shares at $0.01 e…

They sign the purchase order on 1/1/26. AMD issues invoice to be paid in 30 days, that is 2/1/26. OpenAI triggers warrant and informs AMD on 1/2/26. OpenAI receives shares on 1/4/26. On 1/5/26 OpenAI and AMD announce the GPU purchase deal. On 1/30/26 OpenAI sells its shares in AMD. From proceeds, OpenAI pays AMD on 2/1/26. Thus, AMD financed OpenAI's GPU purchase via AMD's shares.

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

#217

Post by stingraycharles »

HarHarVeryFunny wrote: post #157
nerdix wrote: post #10

The title didn't make this obvious (at least not to me) but it's OpenAI that has the option to buy 10% of AMD. Not the other way around. In case you're wondering how OpenAI could afford to buy 10% of AMD while they are hemorrhaging money -- the terms of the deal allows OpenAI to buy 160 million shares at 1 cents a share. I could be thinking about this the wrong way but it appears that AMD is basically subsidizing the…

AMD is giving OpenAI warrants (cf options) to buy AMD shares at 1c/share, but these only vest if OpenAI goes thru with AMD purchases as intended. It seems to basically give OpenAI an incentive to go thru with the deal.

The stock popped quite a bit today, so investors seem to think this is a good deal for AMD. I tend to agree, may finally enable AMD to get a foot in the door in the whole large scale AI market.

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

#218

Post by bgwalter »

agentcoops wrote: post #196
HarHarVeryFunny wrote: post #157

Earlier quoted context omitted.

AMD is giving OpenAI warrants (cf options) to buy AMD shares at 1c/share, but these only vest if OpenAI goes thru with AMD purchases as intended. It seems to basically give OpenAI an incentive to go thru with the deal.

I’ve seen a lot of confusion about this type of deal recently: notably, it is often taken to imply something more or less shady is going on. I’m not sure when such arrangements became a thing, but I know equity stakes have long been an important part of enterprise SaaS deals. The reasoning is relatively straight-forward: if a large client commits to a vendor in a way that holds some risk to the former and will materi…

The skepticism is not sudden. Various kinds of circular deals were common in 1999/2000, shortly before the bubble burst, when telecom equipment makers subsidized their customers in order to prop up sales.

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

#220

Post by stingraycharles »

agentcoops wrote: post #196
HarHarVeryFunny wrote: post #157

Earlier quoted context omitted.

AMD is giving OpenAI warrants (cf options) to buy AMD shares at 1c/share, but these only vest if OpenAI goes thru with AMD purchases as intended. It seems to basically give OpenAI an incentive to go thru with the deal.

I’ve seen a lot of confusion about this type of deal recently: notably, it is often taken to imply something more or less shady is going on. I’m not sure when such arrangements became a thing, but I know equity stakes have long been an important part of enterprise SaaS deals. The reasoning is relatively straight-forward: if a large client commits to a vendor in a way that holds some risk to the former and will materi…

I think the skepticism is mostly aimed towards OpenAI making commitments to spend copious amounts of money, rather than the options that AMD is offering which makes sense.
Post reply on HN