AMD has agreed to acquire World Labs, the San Francisco AI lab co-founded and led by Fei-Fei Li, in an all-stock transaction valued at approximately $8.2 billion, the chipmaker announced on Monday. Li will join AMD as executive vice president and chief scientist once the deal closes.
In a securities filing, AMD said it signed a merger agreement on Sept. 26 to acquire all of the equity in World Labs for a total purchase price of about $8.2 billion, to be paid in AMD common stock to World Labs stockholders, subject to customary adjustments. The number of shares has not been set and will be based on AMD’s volume-weighted average stock price over 10 trading days ending shortly before closing, according to the filing. AMD expects the deal to close by the end of 2026, subject to regulatory approvals and other customary closing conditions.
World Labs develops spatial-intelligence models that generate, reconstruct and simulate interactive 3D environments from text, image and video inputs, as well as technology for robotic learning and simulation, AMD said. CNBC reported that AMD had previously invested in the startup, and Reuters reported that World Labs raised $1 billion in a funding round earlier this year.
After the deal closes, Li will report to AMD Chair and CEO Lisa Su, and the World Labs team will continue to focus on AI model research, according to AMD. World Labs said in a blog post that Justin Johnson and Ben Mildenhall will work with Li to keep leading the team inside AMD, and that the group is committed to an open AI ecosystem that includes widely accessible open models. CNBC reported that AMD plans to keep World Labs separate from its chipmaking business until the transaction closes.
“Building the compute platforms for the next generation of AI requires a deep understanding of how models are evolving,” Su said in the announcement.
“Joining AMD will give our team the resources and engineering depth to accelerate our research and help define the infrastructure needed for the next era of AI,” said Li, whom AMD identified as World Labs’ co-founder and CEO.
AMD said World Labs’ expertise will give it deeper insight into how AI workloads are evolving and help shape its future technology roadmaps. The Wall Street Journal said the deal “reflects chip makers’ ambitions to control more of the AI stack,” noting that AMD recently touched a $1 trillion valuation. CNBC reported that it is AMD’s second-largest acquisition on record, after the roughly $50 billion it paid for Xilinx in 2022.