AMD agreed on Monday to acquire World Labs, the artificial intelligence startup co-founded by Stanford researcher Fei-Fei Li, in an all-stock deal valued at approximately $8.2 billion.
Fei-Fei Li, who built the ImageNet database and is widely called the “godmother of AI,” will join AMD as executive vice president and chief scientist, reporting to chief executive Lisa Su, according to a statement from the two companies.
World Labs, founded in San Francisco at the start of 2024, builds “world models”: AI systems trained on images, video and text that generate and simulate interactive three-dimensional environments. The technology is intended to help train robots, simulate factories and support scientific research.
Building the compute platforms for the next generation of AI requires a deep understanding of how models are evolving.
Su made that statement in AMD’s press release, adding that Li and her team “bring exceptional research leadership and model expertise.” The deal is expected to close by the end of 2026, subject to regulatory approval, and World Labs’ researchers will keep working on AI model research after the transaction closes, AMD said. Co-founders Justin Johnson and Ben Mildenhall will continue to lead that team alongside Li, the companies said.
Li wrote about the decision in a post on her Substack, saying a company built for foundation models needed closer ties to hardware. “Without having a focused hardware effort, AI is hobbled in efficiency. And scale. And for our purposes, remains trapped in the digital world,” she wrote.
“The universe isn’t made up of words; it’s made of real things,” Li wrote, describing the belief that language alone is not sufficient for building advanced AI models.
Li said Su was an early investor in World Labs and that the two companies had run a “deep technical partnership” since last year, starting with training and inference work on AMD’s graphics processors. Li also appeared as a guest at AMD’s presentation at the CES trade show earlier this year.
World Labs raised roughly $1 billion in funding in February, with AMD and rival chipmaker Nvidia both listed among its investors alongside Autodesk, Emerson Collective, Fidelity and Sea, according to the company’s funding announcement. The Ars Technica news site reported that AMD had also contributed to World Labs’ earlier $230 million funding round in 2024, alongside co-founders Christoph Lassner and Mildenhall.
Racing Nvidia into physical AI
The acquisition is AMD’s attempt to compete with Nvidia, the dominant maker of AI chips, as the industry expands from text-based language models into robotics, self-driving cars and other applications that require an understanding of physical space, according to Fortune. Nvidia already sells an open-weight suite of world models called Cosmos and has partnered with startups such as Wayve on models for self-driving cars.
AMD said in its statement that its own models had so far been focused on text and video, and that World Labs’ expertise would help it design chips, software and systems around the needs of emerging AI workloads. The company’s first commercial product, Marble, generates three-dimensional spaces from text, images or video that can be exported for use in film, video games and robot training; its newer model, Atlas, predicts how a scene would appear from a different camera angle using a small set of two-dimensional images.
World Labs is one of several startups pursuing world models. Yann LeCun, Meta’s former chief AI scientist, launched a rival venture, AMI Labs, in March, according to Fortune.
The World Labs deal follows other recent AMD acquisitions aimed at deepening its position in AI infrastructure: the company bought Taalas, a startup that etches AI models directly into silicon, in August, and in July it said it would invest $5 billion in the AI company Anthropic, according to the Verge and the Next Web. AMD shares traded roughly flat after the announcement, Fortune reported.
The deal also brought together two of the most prominent women in an AI industry still dominated by men. Su became chief executive of the first company led by a woman to reach a $1 trillion market valuation last week, according to Fortune, while Li ranked 45th on the outlet’s most recent list of the most powerful women in business, with Su at third.