AI Daily: Nvidia CEO ‘surprised’ AMD offered 10% stake in OpenAI deal

Catch up on the top artificial intelligence news and commentary by Wall Street analysts on publicly traded companies in the space with this daily recap compiled by The Fly:

OPENAI DEAL: Nvidia (NVDA) CEO Jensen Huang said AMD’s (AMD) deal to offer 10% of itself to OpenAI is “surprising” and “imaginative” considering AMD was “so excited about” its next-generation chip, the executive told CNBC’s “Squawk Box” in an interview. “I’m surprised that they would give away 10% of the company before they even built it. And so anyhow, it’s clever, I guess,” Huang said. OpenAI has committed to purchase 6 gigawatts worth of AMD chips over multiple years, including its forthcoming MI450 series, and OpenAI will receive warrants for up to 160 million AMD shares, with vesting milestones based on deployment volume and AMD’s share price.

LAWSUITS: Microsoft-backed (MSFT) OpenAI and Anthropic are debating on using investor funds to settle any potential claims from multibillion-dollar lawsuits, Cristina Criddle and Lee Harris of The Financial Times report. While both companies have traditional business insurance coverage, insurance professionals have said AI model providers may struggle to secure protection for the full damages they may need to pay in the future. OpenAI is using Aon (AON) for help and has secured up to $300M for AI risks, people familiar with the company’s policy told the Times.

FUNDING ROUND: xAI, the artificial intelligence startup backed by Tesla (TSLA) CEO Elon Musk, is raising more financing than previously planned, including an equity investment from Nvidia, to bring its ongoing funding round to $20B, Bloomberg’s Carmen Arroyo and Ed Ludlow report, citing people familiar with the matter. The financing, which includes equity and debt, will be linked to the Nvidia GPUs that the AI startup intends to use in Colossus 2, the name of its biggest data center site, the authors note.

AI ENTERPRISE PLATFORM: Hoth Therapeutics (HOTH) announced it has expanded its artificial intelligence initiative through a new Nvidia AI Enterprise subscription license to accelerate data-driven drug development, preclinical modeling, and predictive analytics. Under the new entitlement and renewal agreement, Hoth Therapeutics has secured annual Nvidia AI Enterprise Essentials licenses to support its GPU-powered infrastructure, enabling advanced machine learning and neural network modeling capabilities for pharmaceutical research.