OpenAI’s blockbuster chip-buying agreement with Advanced Micro Devices appears to be a shot across the bow at market leader Nvidia . Jim Cramer says Nvidia is hardly surrendering its lead in the AI computing race. “In the end — I know this is going to be facetious — I think everybody wins,” Jim said Monday, as AMD shares surged more than 30% on its deal with the ChatGPT creator, which AMD expects will result in tens of billions of revenue in the coming years. Nvidia’s stock, meanwhile, slipped about 1.5% on Monday, which Jim suggested is not a surprising initial reaction considering AMD has worked furiously in recent years to become a more formidable challenger in the red-hot market for power-hungry AI chips. “Nvidia goes down maybe $5, $6 [per share] today. Then you need to buy it, because I don’t think there’s any change in the demand,” Jim said. “I think that all these companies have to rethink and say, ‘Oh my, [OpenAI CEO Sam] Altman is really spending. I guess we’ve got to spend more.'” OpenAI’s recent dealmaking spree also includes a tie-up with Nvidia — adding to the intrigue around the influential startup’s deepening ties with AMD. OpenAI agreed to purchase 6 gigawatts of AMD’s AI chips over multiple years. Every gigawatt of compute translates to “significant, double-digit billions of revenue to us,” AMD CEO Lisa Su told CNBC on Monday. OpenAI also secured warrants for AMD common stock that, if certain conditions are met, could result in OpenAI owning roughly 10% of AMD. Su said that the ownership arrangement aligns the incentives of both companies. OpenAI is looking to use AMD’s chips for inference, the process of running AI models on a day-to-day basis. Feeding AI models massive amounts of data to prepare them for use is called training, which has historically been Nvidia’s stronghold. AMD is projected to bring in roughly $33 billion in sales this year, according to FactSet, with about half of that coming from its data center business, where its AI revenue is recorded along with sales of traditional server processors. NVDA AMD 5Y mountain Nvidia’s stock performance versus AMD over the next five years. Nvidia, for its part, in late September agreed to invest $100 billion in OpenAI to help the company construct 10 gigawatts of artificial intelligence data center capacity over a multiyear timeframe. OpenAI has long used Nvidia’s chips to train and run the AI models that have fueled its rapid rise since the launch of ChatGPT in late 2022. Nvidia has ascended to the world’s most valuable company thanks to the AI boom, and its annual revenue is projected to top $200 billion in its current fiscal year, up from $27 billion in the 12 months ended in January 2023. For some on Wall Street, Nvidia’s investment in one of its most important customers called to mind some of the creative financing agreements that arose in the later stages of the dot-com bubble. Nvidia CEO Jensen Huang has pushed back on concerns about “circular revenue,” whereby Nvidia’s investment dollars end up flowing back to the company via OpenAI chip orders. “The investment side is not tied to anything,” Huang said on a Sept. 25 podcast hosted by the Silicon Valley investor Brad Gerstner. “It’s an opportunity to invest in [OpenAI]. This is likely to be the next multitrillion-dollar hyperscale company. Who doesn’t want to be an investor in that?” OpenAI was valued at $500 billion in a stock sale for employees that closed last week. As the usage of OpenAI’s applications surges, the company needs more resources to meet the demand, said Greg Brockman, its president and a co-founder alongside Altman. “We need as much computing power as we can possibly get,” Brockman said in a CNBC interview with Jim on Monday, when asked why OpenAI struck an accord with AMD on top of its Nvidia deal. OpenAI is also reportedly working with Club name Broadcom to develop custom chips. Broadcom shares were flat in midmorning trade Monday, giving up earlier gains. “I think that when it comes to the suppliers of this computing power, I think that Nvidia has something very special – we use them for training, we use them for inference,” Brockman said. “AMD, I think, also is really delivering in terms of the next generation of chip they’ve been working on. We’ve provided feedback. We’ve been doing a lot of software work to enable it for inference within our infrastructure. We really see the whole ecosystem as something that’s coming together to deliver the amount of inference that will be required to bring AI to everyone at scale.” Brockman said OpenAI is “unable to launch many features in ChatGPT — many products that would generate lots of revenue — simply because of a lack of compute power.” If OpenAI had 10 times as much computing power as it does now, “I don’t know if we’d have 10x more revenue, but I don’t think it’d be that far,” he said. (Jim Cramer’s Charitable Trust is long NVDA. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. 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