AMD to buy Fei-Fei Li's World Labs in $8.2 billion bet on 'physical AI'

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September 28, 2026 4:11 PM EDT

FILE PHOTO: The AMD logo in this illustration, taken June 11, 2026. REUTERS/Dado Ruvic/Illustration/File Photo

Sept 28 (Reuters) - Advanced Micro ‌Devices said ​on ​Monday it would acquire Fei-Fei Li's AI startup, World Labs, in an all-stock deal valued at $8.2 billion, ‌a move that would give the chipmaker a foothold ⁠in research on physical AI systems that can understand and simulate the world.

The ‌acquisition gives AMD access ‌to research on spatial intelligence, an emerging field focused on enabling AI systems to model three-dimensional environments and physical interactions, ​which could shape future demand for chips, software and AI infrastructure.

"We began a deep technical partnership with AMD last ⁠year, starting with model training and inference optimization on AMD GPUs," Li said in ​a post on LinkedIn.

"As our teams worked together, we realized it would be a natural fit to ​bring together our AI ecosystem of ‌software and hardware, foundation models, and applications."

World Labs raised $1 billion in a funding round earlier this year ⁠that included an investment from AMD.

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.

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.

(Reporting by Akash Sriram and Arasu Kannagi Basil in Bengaluru; Editing by ‌Maju Samuel)


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