AMD announced the acquisition of artificial intelligence company World Labs in an all-stock deal valued at approximately $ 8.2 billion . The acquisition is one of the largest AI moves of 2026 and marks a strategic shift by AMD to compete with Nvidia and other industry giants.
World Labs was founded in 2024 by distinguished researcher Dr. Fei-Fei Li and managed to achieve a $1 billion within months of its founding — an impressive achievement that reflects the market’s immense confidence in its team’s vision and capabilities. In 2025, the company released its first commercial product: a world generation model called Marble that allows users to create interactive 3D worlds through simple text prompts.
The deal is expected to close by the end of this year. Under the terms of the deal, Dr. Fei-Fei Li will assume the role of EVP and Chief Scientist of AMD, reporting directly to CEO Lisa Su. In addition, the World Labs will continue to focus on advancing research in artificial intelligence models, significantly strengthening AMD’s capabilities in this area.
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World Labs and AMD: What the acquisition means for the future of artificial intelligence
AMD says the acquisition will strengthen its “ability to develop AI hardware, software and systems around the needs of emerging models and applications .” This is critical as competition in the space for processors and accelerators for AI workloads becomes increasingly fierce. Nvidia currently dominates the market with its GPUs, but AMD is looking to close the gap through strategic acquisitions and research investments .
Dr. Fei-Fei Li is one of the most respected voices in artificial intelligence worldwide. Best known for creating ImageNet — the massive image database that laid the foundation for the deep learning — Li has also served as director of the Stanford Human-Centered AI Institute (HAI) and chief AI scientist at Google Cloud. Her industry experience and reputation bring tremendous value tothe deal, beyond World Labs.
“Just as I knew it was time to start a startup to accelerate foundational models beyond LLMs and achieve the greatest impact in AI, it’s also very clear to me now that the right path for me and World Labs is to continue our mission as part of AMD,” Li said in a post on Substack. “Together, we are committed to continuing to push the boundaries of AI to solve real problems, and to doing so openly with the community and the entire ecosystem.”
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World Labs: The technology that the acquisition brings to AMD
The key technology asset AMD is gaining through the World Labs acquisition is the ability to create spatial intelligence — the ability of AI models to understand and create three-dimensional spaces and worlds. This technology has applications in many areas, from video games and virtual reality to autonomous driving, robotics and industrial design.
World Labs ' Marble model represents a new class of generative AI : instead of generating text or images, it generates entire interactive worlds. The user gives a description in natural language, and the system creates a full 3D environment that can be explored in real time. This requires enormous computing power, and this is where AMD sees a huge opportunity: developing specialized hardware for such workloads could open up new markets for it.
CEO Lisa Su was clear about the strategic rationale for the move: “Building computing platforms for the next generation of AI requires a deep understanding of how models evolve. Fei-Fei and the World Labs team bring exceptional research leadership and model expertise. Together, we can use this knowledge to develop the hardware, software , and systems that will power the next generation of AI and strengthen the open AI ecosystem.”
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The deal is part of a broader wave of acquisitions in the AI space. Earlier this month, Nvidia announced it was acquiring Hugging Face for nearly $13 billion, in a move that also aims to strengthen its presence in the open-source AI ecosystem. According to The Verge, these two acquisitions reflect a new phase in the competition among the big players in AI hardware, where acquiring research capacity and talent is as important as developing new chips.
For AMD, the acquisition of World Labs signals a clear commitment: the company doesn’t just want to sell GPUs for AI training, but to become a complete provider of AI — from hardware to models and applications. The presence of Dr. Fei-Fei Li as Chief Scientist will also give it greater credibility in the academic and research world, which is critical for attracting talent and partnerships.
