AMD agrees to buy Fei-Fei Li’s World Labs for $8.2bn

In short: AMD has agreed to buy World Labs, an AI start-up founded by Stanford researcher Fei-Fei Li, for about $8.2bn in an all-stock deal.

What happened

AMD, a major chip company, said it will acquire World Labs for $8.2bn. The payment will be in stock, which means AMD will pay using shares in its company instead of cash.

World Labs was founded in 2024 by Fei-Fei Li, a well-known artificial intelligence researcher at Stanford University. The company works on “world models,” which are AI systems designed to understand and copy 3D environments. You can think of this like teaching a computer to build a mental map of a room, not just recognize a photo of it.

AMD chief executive Lisa Su said the deal will help AMD better understand how AI work is changing and use that knowledge to plan future products. The Financial Times reported that the acquisition would also push AMD further beyond selling chips and into developing AI models themselves.

AMD has been making several acquisitions in recent years. These include buying ZT Systems for $4.9bn in 2025 and buying Finnish AI model company Silo AI for $665mn in 2024.

Why it matters

This deal is a sign that chip makers want more control over the full AI “stack” (the full set of parts needed to build and run AI), not just the chips. For regular people, that can shape how quickly and how cheaply new AI features show up in products like robots, games, and tools that need to understand space and movement.

Source: Financial Times