Meta strikes deal for AMD AI chips to reduce reliance on Nvidia

NEW YORK – Meta Platforms has reached a massive agreement to purchase artificial intelligence chips from Advanced Micro Devices in a deal that could be worth more than $100 billion. The arrangement also grants the Facebook parent company the right to acquire up to a 10% stake in AMD.

Meta plans to deploy AMD's latest MI450 chips across its AI data centers. The supply agreement covers infrastructure with a total power capacity of up to 6 gigawatts.

Deliveries for the first phase of the project, supporting 1 gigawatt of capacity, are expected to begin in the second half of this year.

The announcement sent AMD shares climbing more than 9% in pre-market trading. As part of the deal, Meta received performance-based warrants to purchase up to 160 million AMD shares at a nominal price, which are triggered as purchasing milestones are met.

The deal comes just days after Meta announced a long-term partnership with Nvidia, AMD's primary rival in the high-stakes AI semiconductor market.

The partnership between Meta Platforms and Advanced Micro Devices (AMD) is far more than a routine hardware procurement; it represents a decisive tactical maneuver in the escalating artificial intelligence arms race gripping Silicon Valley. For Meta, the alliance is a strategic necessity aimed at diversifying its supply chain and eroding its near-total reliance on Nvidia. As it stands, Nvidia’s stranglehold on the AI chip market has granted the company unparalleled pricing power while creating systemic supply bottlenecks for the rest of the industry.

By pivoting toward AMD, Meta is sending an unambiguous signal to the market: the social media giant requires a formidable second source to foster competition, stabilize costs, and secure the massive compute capacity required for its long-term AI roadmap. This investment—compounded by Meta’s recent multi-billion dollar infrastructure spend and startup acquisitions—highlights the intense pressure the company faces to keep pace with rivals such as Google and OpenAI.

For AMD, the deal marks a watershed moment. Securing a flagship customer like Meta serves as a critical validation of its MI-series accelerators, positioning them as legitimate rivals to Nvidia’s dominant GPUs. The agreement does more than generate immediate top-line growth; it establishes AMD as a tier-one player in the high-end AI silicon market, a territory Nvidia has occupied almost exclusively for years. Furthermore, the inclusion of warrants in the deal structure transforms the relationship into a deep strategic partnership, effectively tethering AMD’s commercial success to the scale of Meta’s deployment.

The AI arms race currently unfolding in Silicon Valley, underscored by massive deals like these, is driving a surge in demand for high-tech talent. This creates lucrative career opportunities for engineers and tech professionals, including the substantial Vietnamese-American community established in the tech sectors of California and other major innovation hubs across the country.