New York, Feb 24, 2026, 16:02 ET — After-hours trading
- AMD surged roughly 9% at the close, lifted by news that Meta is set to purchase significant quantities of AMD AI chips spanning a five-year period
- Meta has secured a performance-based warrant in the deal, opening the door to potentially taking up to a 10% stake.
- Nvidia reports earnings Feb. 25, and traders are watching closely for signals on AI chip demand.
Shares of Advanced Micro Devices surged 9.1% to close at $214.51 on Tuesday, fueled by news of a multi-year supply agreement that positions Meta Platforms as a potential major stakeholder. (Yahoo Finance)
This shift is catching attention as chip buyers scramble to secure inventory ahead of the coming surge in data-center construction. Investors, meanwhile, have shown little patience for any sign of cooling AI demand. AMD’s jump also offered a glimpse into how much Wall Street is willing to value so-called “booked” demand—even when shipments are months, or more, down the line.
The bigger AI story here: customers are eager for an Nvidia rival, but they’re pushing for more favorable terms before putting up cash. This time, the sweetener on the table is equity-linked.
AMD and Meta outlined a plan to deploy as much as 6 gigawatts of AMD Instinct GPUs, anchored by a custom GPU based on the MI450, along with sixth-gen EPYC “Venice” CPUs. Everything will run ROCm software on AMD’s Helios rack-scale platform. Initial shipments are expected in the second half of 2026. The focus: inference compute, meaning the everyday processing that lets models answer user prompts. (AMD)
Both companies stressed the extended horizon for their partnership. “We are proud to expand our strategic partnership with Meta,” AMD CEO Lisa Su said. Meta’s Mark Zuckerberg described it as “an important step” in broadening Meta’s computing capabilities. AMD CFO Jean Hu added that the deal’s structure aims to keep “execution and long-term value creation” in sync. (AMD)
Details in a regulatory filing reveal the structure: AMD handed Meta a performance-based warrant, allowing Meta to pick up as many as 160 million AMD shares for just $0.01 apiece. Vesting depends on AMD hitting certain shipment and purchase milestones—capping out at a total of six gigawatts—as well as AMD’s stock price climbing all the way to $600 for the last batch. (SEC)
For AMD, it’s simple: a fresh commitment from another hyperscaler, plus sharper visibility on GPU shipments. Meta, on the other hand, gets more levers—supplier diversity, steadier delivery forecasts, and an option to cash in if AMD hits its marks.
The term sheet spells out the risks, too. Miss a milestone, see volumes shift, or watch AI budgets tighten, and that “paid-for demand” quickly turns from strength to liability. The warrant brings old dilution concerns back into the conversation, plus the nagging sense that buyers hold the upper hand while searching for Nvidia substitutes.
Eyes turn to Nvidia’s numbers next, with the AI heavyweight set to release earnings and hold its conference call after the bell Wednesday, Feb. 25. Traders will be combing through the details for fresh signals. (NVIDIA Newsroom)
