AMD Acquires Fei-Fei Li’s World Labs in $8.2 Billion All-Stock Deal to Bolster AI Capabilities

AMD has announced its acquisition of World Labs, the artificial intelligence startup founded by renowned AI researcher Fei-Fei Li, in an all-stock transaction valued at approximately $8.2 billion. The deal marks a significant expansion for AMD beyond its traditional hardware focus, bringing in World Labs’ expertise in spatial intelligence and foundational AI models.

Under the terms of the agreement, Fei-Fei Li will join AMD as executive vice president and chief scientist, reporting directly to CEO Lisa Su. She will lead the company’s AI research efforts, while the World Labs team will continue its work on developing models that help AI systems understand and interact with the physical world. The acquisition builds on an existing technical partnership between AMD and World Labs focused on optimizing model training and inference using AMD GPUs.

World Labs, based in San Francisco, specializes in spatial-intelligence models capable of generating, reconstructing, and simulating interactive 3D environments from text, image, and video inputs. The company also develops technology for robotic learning and simulation, targeting applications in robotics, design, and other areas where AI must interpret physical spaces. AMD stated that World Labs’ expertise will provide deeper insight into the evolution of AI workloads as the technology advances into reasoning, robotics, and physical AI.

The transaction is expected to close by the end of 2026, pending regulatory approvals. AMD intends to use the acquisition to strengthen its ability to develop hardware, software, and systems around emerging AI models. Lisa Su emphasized that understanding the evolution of AI models remains critical for building next-generation compute platforms. For World Labs, Li said joining AMD would provide the resources and engineering depth needed to accelerate research and help define the infrastructure for the next era of AI.

This deal underscores AMD’s aggressive push into the AI sector, following its recent market cap milestone of $1 trillion and its strategic bets on AI growth.