Capital expenditures-capex, meaning the big-ticket purchases that fund the data centers, servers, and power infrastructure undergirding the AI race-is fueling record-high, multi-trillion dollar tech valuations when investors think the spending is warranted. But companies get punished when investors worry they might not see returns that justify hundreds of billions in spending.
As part of the arrangement, AMD will allow OpenAI to purchase up to 160 million AMD shares at 1 cent each throughout the chips deal. OpenAI diversifies its chip supply With demand for AI compute growing rapidly, companies like OpenAI have been looking for secondary supply lines and sources of additional computing capacity, and the AMD partnership is part the company's wider effort to secure sufficient computing power for its AI operations.
