AMD's Strategic Financing Move Highlights Intensifying AI Chip Competition

AMD backs Crusoe's $300M loan with its chips as collateral, mirroring Nvidia's strategy, as its stock faces pressure and it denies rumors of a key chip delay.

In a bold maneuver to strengthen its position against rival Nvidia, Advanced Micro Devices (AMD) has entered into an unconventional financial agreement. The semiconductor firm is providing a credit guarantee to support cloud startup Crusoe, a deal that underscores the fierce battle for market share in the artificial intelligence sector.

Unconventional Deal Structure Backs Startup Purchase

According to a February 19 report by The Information, AMD has guaranteed a loan for the AI infrastructure company Crusoe. Under the arrangement, Goldman Sachs is providing $300 million in financing. These funds are designated for Crusoe to purchase AMD accelerators for a data center located in Springfield, Ohio.

A key feature of this agreement is that AMD's own chips serve as collateral. Should Crusoe fail to secure enough customers for its services, AMD has committed to leasing the processors back. This security provision enabled Crusoe to secure an interest rate of approximately 6%, notably below prevailing market rates.

This strategy mirrors an approach already deployed successfully by Nvidia. AMD's competitor previously used its H100 GPUs as collateral to back a $2.3 billion credit line for AI cloud provider CoreWeave. Crusoe CEO Chase Lochmiller had previously announced intentions to acquire $400 million worth of AMD chips.

Share Price Faces Pressure Following Quarterly Report

AMD's stock has experienced selling pressure since the release of its fourth-quarter results on February 3. Despite the company reporting earnings per share of $1.53, surpassing expectations of $1.32, and a 34.1% year-over-year revenue increase to $10.27 billion, its guidance for the first quarter disappointed investors. The share price fell sharply by 17.3% on February 4.

Trading during the week of February 17-20 remained volatile around the $200 level. The equity closed at $200.15 on Friday, representing a decline of roughly 25% from its 52-week high of $267.08. Daily trading volume stayed elevated, ranging between 25 million and 36 million shares.

Company Denies Rumors of Next-Gen Chip Delay

Further market uncertainty arose from a report by SemiAnalysis suggesting a potential delay in the mass production of AMD's next-generation Instinct MI455X accelerator until the second quarter of 2027. The company issued a strong rebuttal to these claims.

Anush Elangovan, AMD's Vice President of Software Development, labeled the report "nonsense" in a post on the social media platform X. He reaffirmed that shipments for the MI455X platform remain on schedule to commence in the second half of 2026 as originally planned.

The MI455X platform, featuring 72 accelerators and 31 terabytes of HBM4 memory, is viewed as AMD's strategic response to Nvidia's upcoming Vera Rubin system. A timely launch is considered critical for AMD to regain competitive ground in the high-stakes AI chip market. The industry's next significant benchmark will arrive with Nvidia's own quarterly earnings report, scheduled for February 25.