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OpenAI's AMD, Nvidia Deals Are Huge, But Execution Is Key, Says Brad Gerstner
Benzingaยท2025-10-07 12:19

Group 1 - Investor Brad Gerstner cautioned that OpenAI's recent partnerships with Nvidia and AMD are still announcements and not actual implementations, emphasizing that execution will determine success in the AI sector [1] - AMD has entered a deal with OpenAI to deploy up to 6 gigawatts of AMD Instinct GPU power for future infrastructure, with the rollout starting in late 2026 [2][3] - Under the agreement, AMD issued warrants for up to 160 million shares, which could generate "tens of billions in revenue" and be "highly accretive" to earnings [4] Group 2 - Nvidia announced a $100 billion partnership with OpenAI to deploy 10 gigawatts of Vera Rubin systems starting in the second half of 2026, with potential long-term revenue estimated between $300 billion to $500 billion [5] - The AI industry is facing a compute-constrained environment, highlighting the need for expanded chip partnerships to meet rising global demand for AI services [5][6] - AMD's stock has increased by 69% year-to-date, outperforming the Nasdaq 100 index, while Nvidia's stock has risen over 38% [7]