OpenAI strikes over $10 billion compute deal with Cerebras – Firstpost
OpenAI will purchase up to 750 megawatts of computing power over three years from chipmaker Cerebras as the ChatGPT maker looks to pull ahead in the AI race and meet the growing demand, the two companies reported on Wednesday.
This deal is worth more than $10 billion over the life of the contract, according to a source familiar with the matter. The ChatGPT maker plans to use the systems built by Cerebras to power its popular chatbot in what is the latest in a string of multi-billion-dollar deals struck by OpenAI.
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Cerebras Chief Executive Andrew Feldman mentioned the two companies began talks last August after Cerebras demonstrated that OpenAI’s open-source models could run more efficiently on its chips than on traditional GPUs. After months of negotiations, the companies reached an agreement under which Cerebras will sell cloud services powered by its chips to OpenAI, focusing on inference and reasoning models, which typically take time to “think” before generating responses.
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As part of the deal, Cerebras will build or lease data centers filled with its chips, while OpenAI will pay to use Cerebras’ cloud services to run inference for its AI products. The capacity will come online in multiple tranches through 2028.
“Integrating Cerebras into our mix of compute solutions is all about making our AI respond much faster,” OpenAI stated in a post on its website.
The deal underscores the industry’s strong appetite for computing power to run inference — the process by which models respond to queries — as companies race to build reasoning models and applications to drive adoption.
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The tie-up will be key to Cerebras’ latest efforts in going public, as it will help Cerebras diversify its revenue away from UAE-based tech firm G42, which has been both an investor and one of its largest customers.
Founded in 2015, Cerebras is known for its wafer-scale engines, chips designed to accelerate training and inference for large AI models, competing with offerings from Nvidia and other AI chipmakers. Sam Altman, CEO at OpenAI, is an early investor in Cerebras.
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Reuters reported last month that Cerebras was preparing to file for an initial public offering, targeting a listing in the second quarter of this year. This marks the company’s second attempt at the public exchange. It first filed paperwork for IPO in 2024, before postponing and ultimately withdrawing in October.
OpenAI is laying the groundwork for its own IPO that could value it at up to $1 trillion, Reuters had also reported.
CEO Sam Altman had noted last year that OpenAI is committed to spending $1.4 trillion to develop 30 gigawatts of computing resources — enough to power roughly 25 million U.S. homes.
While companies commit hefty amounts to the booming technology and valuations soar, investors and experts have raised concerns that the industry might be turning into a bubble reminiscent of the dotcom boom and bust.
(Except the headline, this story has not been edited by Firstpost staff)
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