AMD will acquire Fei-Fei Li’s World Labs for $8.2 billion

AMD announced it will acquire World Labs, a developer of deep-learning models designed to represent and reason about physical reality, for $8.2 billion. The deal will bring World Labs founder Fei-Fei Li into AMD as executive vice president and chief scientist. AMD and World Labs previously formed a partnership last year focused on inference optimization and training, and the companies have maintained close ties; Li appeared as a guest at AMD’s CES presentation earlier this year.

World Labs was created in 2024 with the stated goal of building models that have a more robust understanding of the physical world, arguing that such grounding in physics and multimodal data is important for progress toward more general intelligence. Its first product, Marble, is presented as a tool for building entertainment experiences and for generating simulated environments that can be used to train robots.

AMD framed the acquisition as a way to better understand frontier AI workloads produced by organizations like World Labs, which it says will inform its chip-development roadmap. Observers note the move could strengthen AMD’s position against long-standing rival Nvidia by expanding AMD’s ecosystem for AI-specific chips; Nvidia already offers open-weight world models such as Cosmos, while AMD has publicly released text- and video-based models to date.

The term "world model" is used broadly and can refer to language models that process visual inputs as well as systems capable of generating sustained, high-fidelity simulations of reality. Proponents of world models see them as important for applying generative AI to robotic platforms — including autonomous vehicles, industrial robots and humanoid systems — because synthetic environments and data can help address shortages of real-world training data. The acquisition is subject to regulatory approval and is expected to close before the end of the year.