Meta Secures $100 Billion AMD Chip Deal for AI Expansion

Feb 24, 2026

92 min

Feb 24, 2026 17:32

Meta strikes $100 billion AMD chip deal to power next-gen AI push

## Major AI Infrastructure Deal

Meta has entered into a significant agreement with Advanced Micro Devices (AMD) to acquire next-generation AI processors. This multiyear deal, potentially valued at $100 billion, marks a major step in Meta's efforts to advance its artificial intelligence capabilities.

## Custom Chips for AI Systems

The partnership will provide Meta with custom-designed chips tailored for its specific AI workloads. These chips will be deployed in data centers starting in the latter half of 2026, enhancing Meta's ability to perform AI inference, which is crucial for real-time user interaction.

## Strategic Financial Structure

As part of the deal, Meta will receive performance-linked warrants to acquire up to 160 million AMD shares, potentially giving it a 10% stake in AMD. This financial arrangement aligns the interests of both companies, linking Meta's infrastructure growth with AMD's technological advancements.

## Diversifying Chip Suppliers

This move is seen as a strategy by Meta to diversify its chip suppliers beyond Nvidia, which currently dominates the AI chip market. By doing so, Meta aims to reduce reliance on a single vendor and secure a stable supply of AI hardware amidst increasing demand.

## Expanding AI Investments

Meta plans to significantly increase its spending on AI systems, with projections reaching up to $135 billion in 2026. This is part of a broader trend among tech giants like Microsoft, Google, and Amazon, who are collectively expected to invest over $630 billion in AI and data-center infrastructure this year.

## Strengthening AI Capabilities

The deal positions AMD as a key player in the AI chip market and supports Meta's expansion of AI-driven products across its platforms, including Facebook, Instagram, and WhatsApp. This partnership is crucial for Meta's strategy to build the necessary hardware to support advanced AI systems, reflecting the intensifying competition in the tech industry to develop powerful AI technologies.

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