- AMD has agreed to acquire World Labs in an all-stock transaction valued at approximately $8.2 billion, subject to regulatory approvals and customary closing conditions.
- Co-founded by AI pioneer Dr Fei-Fei Li, World Labs develops spatial-intelligence models that generate and simulate interactive 3D environments for robotics and other Physical AI applications.
- Li will become AMD’s executive vice president and chief scientist, reporting directly to CEO Lisa Su, while World Labs co-leaders Justin Johnson and Ben Mildenhall will continue to lead the team.
AMD entered a definitive agreement to acquire San Francisco-based World Labs in an all-stock transaction valued at approximately $8.2 billion. The deal is expected to close by the end of 2026, subject to regulatory approvals and other customary conditions.
The acquisition brings World Labs’ spatial-intelligence expertise into AMD as the chipmaker looks to develop hardware, software and systems around increasingly sophisticated AI models.
Fei-Fei Li brings spatial AI expertise to AMD
World Labs was co-founded by Dr Fei-Fei Li, one of the most prominent figures in modern computer vision and AI research. Li previously co-founded World Labs to develop AI systems capable of understanding and interacting with three-dimensional environments.
TFN covered the company’s early journey when World Labs raised $230 million to develop its spatial AI technology.
Following the acquisition, Li will take on the newly created role of executive vice president and chief scientist at AMD, reporting directly to Lisa Su. Justin Johnson and Ben Mildenhall will continue to lead the World Labs team alongside Li.
“Building the compute platforms for the next generation of AI requires a deep understanding of how models are evolving,” said Lisa Su, chair and CEO of AMD. “Fei-Fei and the World Labs team bring exceptional research leadership and model expertise. Together, we can use that insight to develop the hardware, software and systems that will power the next generation of AI and strengthen the open AI ecosystem.”
World Labs develops models capable of generating, reconstructing and simulating interactive 3D environments using text, images and video. Its technology also extends to robotic learning and simulation.
From $1B round to $8.2B acquisition
The acquisition comes months after World Labs raised $1 billion from investors including Nvidia, AMD and other backers, reportedly giving the company a valuation of around $5 billion. TFN covered that funding round as World Labs accelerated its work on spatial intelligence and world models.
The company is part of a wider race to build world models — AI systems designed to understand environments, predict how they evolve and interact with them.
TFN recently examined the growing world-model race, with World Labs among the companies building this emerging intelligence layer.
AMD deepens its Physical AI push
AMD and World Labs already have an established relationship. The companies began a technical partnership last year focused on model training and inference optimisation using AMD GPUs.
“Advancing the next generation of AI technology requires close collaboration across model research, systems and compute,” said Dr Fei-Fei Li, co-founder and CEO of World Labs. “Joining AMD will give our team the resources and engineering depth to accelerate our research and help define the infrastructure needed for the next era of AI.”
The deal also follows AMD’s agreement to acquire Taalas, a Toronto-based company developing specialised AI inference silicon.
Together, the moves show AMD expanding its AI strategy beyond chips as workloads increasingly move into robotics, autonomous systems and simulation.
TFN has also tracked the broader shift of AI capital towards Physical AI and robotics, highlighting how investors are increasingly backing technologies designed to operate in the real world.
For AMD, bringing World Labs closer to its hardware and software teams could provide deeper insight into the computing requirements of the next generation of AI, from digital environments to machines operating in the physical world.
