AMD buys World Labs, Fei-Fei Li’s start-up, for $8.2 billion
The chipmaker is acquiring a lab that specialises in “world models”, AI that understands and simulates three-dimensional space. The aim: anticipate what future AI will need, and not leave Nvidia alone in physical AI.
- AMD will buy World Labs for about $8.2 billion in stock, its second-largest acquisition after Xilinx.
- Fei-Fei Li’s start-up builds “world models” that simulate 3D environments, useful for training robots.
- Fei-Fei Li will become AMD’s chief scientist; the deal should close by the end of 2026.
AMD announced on Monday 28 September a definitive agreement to acquire World Labs, a young artificial intelligence company founded in 2024, for about $8.2 billion, paid entirely in shares. It is the chipmaker’s second-largest acquisition ever, behind Xilinx, completed in 2022 for close to $50 billion.
World Labs was created by Fei-Fei Li, a Stanford professor and a leading figure in computer vision: she is behind ImageNet, the huge database of labelled images that powered the progress of image recognition in the early 2010s. She launched the start-up in early 2024 with researchers Ben Mildenhall and Justin Johnson, convinced that an AI fed only on text is not enough. Once the deal closes, she will become AMD’s executive vice-president and chief scientist, reporting directly to its chief executive, Lisa Su.
“World models” for robots
World Labs’ speciality is world models: AI that generates, reconstructs and simulates three-dimensional environments from text, images or video. Its Marble tool creates 3D worlds that can be explored. Its Atlas model rebuilds a scene from a few photos, such as a virtual replica of a warehouse. These simulations are mainly used to train robots and autonomous vehicles, which lack real-world data to learn from.
For AMD, the point is not to add a model to its catalogue. “Building the compute platforms for the next generation of AI requires a deep understanding of how models are evolving,” says Lisa Su. Watching these new uses closely should help the group design its future chips, software and systems. Fei-Fei Li, for her part, argues that without dedicated hardware work, AI remains stuck in the digital world.
The deal is also aimed at Nvidia, the leader in AI chips, which already offers its own family of world models, Cosmos, and has just put $12.9 billion on the table to buy Hugging Face. The AMD and World Labs teams already knew each other: they had been working together since last year on training models on AMD chips, and AMD took part in February in the start-up’s $1 billion funding round.
At the time, the young company was valued at around $5 billion: AMD is therefore paying about 60% more, seven months later. The deal is due to close by the end of 2026, subject to regulatory approval. Until then, World Labs remains independent. And no product from the tie-up has been announced: for now, AMD is mainly buying a head start in research.
- AMD rachète World Labs et ses « modèles de monde » pour 8,2 milliards de dollars, Next.
- AMD rachète World Labs pour contrer Nvidia sur l’IA physique, Frandroid.
- AMD makes $8B bet on physical AI with World Labs deal, Mobile World Live.
- AMD will acquire Fei-Fei Li’s World Labs for $8.2 billion, TechCrunch.
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