FILE PHOTO: OpenAI logo is seen in this illustration taken May 20, 2024. REUTERS/Dado Ruvic/Illustration/File Photo
Jan 14 (Reuters) - OpenAI said on Wednesday it will purchase up to 750 megawatts of computing power over three years from chipmaker Cerebras as the ChatGPT maker looks to pull ahead in the AI race and capitalize on growing demand.
The deal is worth more than $10 billion over the course of the contract, according to a source familiar with the matter.
The ChatGPT maker plans to use the systems built by Cerebras to power its popular chatbot in what is the latest in a string of multi-billion-dollar deals struck by OpenAI.
It also underscores the industry's strong appetite for computing power as companies race to build systems and applications that can rival or surpass human intelligence.
"Integrating Cerebras into our mix of compute solutions is all about making our AI respond much faster," OpenAI said in a post on its website.
The capacity will come online in multiple tranches through 2028, OpenAI said.
Wednesday's tie-up will help Cerebras diversify its revenue away from UAE-based tech firm G42, which has been both an investor and one of its largest customers.
Cerebras is known for its wafer-scale engines, chips designed to accelerate training and inference for large AI models, competing with offerings from Nvidia and other AI chip makers.
Reuters reported last year that Cerebras was preparing to file for an initial public offering, targeting a listing in the second quarter of the year.
OpenAI is laying the groundwork for its own IPO that could value it at up to $1 trillion, Reuters had also reported.
CEO Sam Altman had said last year that OpenAI is committed to spending $1.4 trillion to develop 30 gigawatts of computing resources — enough to power roughly 25 million U.S. homes.
But while companies commit hefty amounts to the booming technology and valuations soar, investors and experts have raised concerns that the industry might be turning into a bubble reminiscent of the dotcom boom and bust.
The Wall Street Journal first reported the news earlier in the day.
(Reporting by Zaheer Kachwala in Bengaluru; Editing by Alan Barona)
