AMD has agreed to acquire World Labs, the spatial AI startup founded by Fei-Fei Li, in an all-stock deal valued at $8.2 billion. The transaction is expected to close before the end of 2026, pending regulatory approval. According to the company, Li will join AMD as executive vice president and chief scientist, reporting directly to CEO Lisa Su.
Li is one of the most influential figures in AI history, widely referred to as the "Godmother of AI" for building the ImageNet database, a collection of more than 14 million labeled images that became the foundation for modern computer vision research. She founded World Labs in 2024 with a stated thesis that language alone is not sufficient for genuine AI intelligence.
"The universe isn't made up of words; it's made of real things," Li wrote in a Substack post announcing the deal. The company has since raised more than $1.2 billion and developed the Marble family of world models, which it says can process text, images, video, and 3D data to generate and simulate spatial environments.
World models are seen as increasingly critical for robotics and physical AI, where systems must interact with and reason about the real world rather than simply predict the next word in a sequence. The technology is foundational for training robots and autonomous vehicles, particularly given the scarcity of real-world data.
For AMD, the acquisition is as much about competitive positioning as it is about technology. NVIDIA has been building its own ecosystem aggressively, developing the Cosmos family of world models and this month agreeing to acquire Hugging Face for $12.93 billion. AMD invested in both World Labs and Hugging Face before those deals were struck. Losing Hugging Face to NVIDIA and then acquiring World Labs in response signals how seriously AMD is taking the software and model layer of the AI stack, not just the hardware.
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The deal is AMD's second-largest acquisition on record, after the roughly $50 billion Xilinx purchase in 2022. World Labs will continue its research operations separately until the transaction closes, at which point its work on spatial models is expected to inform AMD's future chip roadmap directly.
