Meta and AMD are teaming up to take on Nvidia in a massive AI chip deal

AMD just scored a huge victory in its ongoing battle to catch up with AI giant Nvidia.

On Tuesday, AMD and Meta, Facebook’s parent company, announced a multi-year, multi-generational partnership to scale Meta’s AI infrastructure and accelerate the development of its advanced AI models.

Under the deal, Meta plans to deploy up to 6 gigawatts of AMD GPUs. For context, that’s enough to power nearly 4.5 million homes.

The first shipments supporting an initial one gigawatt deployment are scheduled to begin in the second half of 2026 and will include custom chips optimized specifically for Meta workloads. The announcement also says that Meta will be the ultimate client of AMD’s 6th generation AMD EPYC processors.

The agreement includes performance-based terms that could allow Meta to acquire up to 160 million AMD shares, about 10% of the company, if certain milestones are met. The first tranche is given after the initial gigawatt of chips is shipped, with additional vesting tied to additional chip shipments and AMD stock price thresholds.

AMD shares jumped about 10% on Tuesday morning after the announcement.

AMD is quickly emerging as a viable alternative to Nvidia hardware. The company signed another major AI infrastructure partnership with OpenAI in October to deploy another 6 gigawatts of AI chips.

« We are proud to expand our strategic partnership with Meta as they push the boundaries of AI at an unprecedented scale, » AMD CEO Lisa Su said in a press release today.

She added that this latest partnership will put the company « at the center of the global AI build. »

For Meta, the deal comes as it conducts its own AI arms race against companies like Google and OpenAI in pursuit of more powerful AI systems and, ultimately, the holy grail of artificial general intelligence.

Building these systems requires staggering amounts of computation. Nvidia remains the industry’s leading supplier of AI chips, controlling approximately 84% of the AI ​​and data center market share. This made it the most valuable company in the world with a market capitalization of around $4.6 trillion.

But by working with rivals like AMD, the tech giants hope to avoid becoming dependent on a single vendor.

« We are excited to form a long-term partnership with AMD to implement efficient inferential computing and deliver personal superintelligence, » Meta CEO Mark Zuckerberg said in a press release. « This is an important step for Meta as we diversify our computing. »

The deal with AMD comes just days after Meta announced a separate long-term deal with Nvidia, though that announcement did not reveal what power capacity it would support.