AMD acquires World Labs in $8.2-billion deal to boost AI systems strategy

Advanced Micro Devices AMD-T said on Monday it would acquire Fei-Fei Li’s AI startup World Labs in an all-stock deal valued at US$8.2-billion, giving the chipmaker deeper access to research on AI systems that can understand and simulate the physical world.

The deal gives AMD a foothold in AI-model research as the industry moves beyond chatbots toward systems that can reason about, simulate and interact with the physical world, helping the chipmaker tailor its infrastructure to those emerging workloads.

San Francisco-based World Labs, which raised US$1-billion in a funding round earlier this year, develops spatial-intelligence models that can generate, reconstruct and simulate interactive three-dimensional environments from text, image and video inputs.

The technology is aimed at helping AI systems better understand and reason about the physical world, with potential uses in robotics, simulation, design and other real-world applications.

The startup also develops technology for robotic learning and simulation. Spatial intelligence differs from AI systems focused primarily on language or two-dimensional images by seeking to model how objects, spaces and actions work in a three-dimensional environment.

AMD said it expects World Labs’ research to provide deeper insight into emerging AI workloads and help guide its technology roadmaps across hardware, software and systems.

Li, a prominent AI researcher known for her work in computer vision, will join AMD as executive vice president and chief scientist after the transaction closes. She will report to CEO Lisa Su. The deal is expected to close by the end of 2026.