AMD to Acquire Fei-Fei Li’s World Labs for $8.2 Billion

Summary

AMD announced an agreement to acquire World Labs, a San Francisco-based AI lab founded by researcher Fei-Fei Li, for about $8.2 billion in an all-stock transaction. AMD had previously invested in the company, and the purchase would be the chipmaker’s second-largest acquisition after its roughly $50 billion purchase of Xilinx in 2022. World Labs develops world models that can simulate three-dimensional environments, a technology researchers hope will support robots and other physically grounded AI systems. AMD plans to keep the lab separate from its chip business until the transaction closes later in 2026. The company said World Labs’ research could help it anticipate the capabilities its AI chips will need in future years. Li will become AMD’s chief scientist and an executive vice president. In a demonstration earlier in 2026, Li and AMD CEO Lisa Su showed the World Labs model Marble generating a 3D scene from a few images. Li said such digital environments could allow intelligent agents, including robots and vehicles, to learn in physics-aware simulations before deployment in the real world, potentially improving safety. The deal comes as major technology companies spend heavily on AI businesses and research talent, including through acquisitions and strategic investments.