Key progress in AI data center financing! Fermi (FRMI.US) partners with AMD (AMD.US) to secure credit support, shares surge in early trading.

Fermi (FRMI.US), which focuses on developing AI hyperscale data centers, said on Tuesday that it has signed a credit support agreement with AMD (AMD.US) to support a lease arrangement for the first phase of its Texas energy and AI facility, Project Matador campus, marking a key step forward in securing financing for the project. Boosted by the news, Fermi shares were up 18% in early U.S. trading on Tuesday as of press time. Under the cooperation agreement signed by the two parties, Fermi will provide land, permits, water resources, power equipment, and fiber optic network infrastructure, while AMD will provide credit support and computing technology. The two companies also signed an agreement that clarifies their partnership and sets out a framework for future expansion, with total power capacity ultimately expandable to up to 650 megawatts. Fermi said the relevant assets of Project Matador have been secured or are subject to long-term lease agreements. To date, construction investment in the project has exceeded $1.5 billion. The company expects the project will eventually scale gradually to about 17 gigawatts, but only on the premise of signing legally binding agreements with customers. Mathew Hein, Senior Vice President and Chief Strategy Officer of Corporate Development at AMD, said: "The pace of AI innovation is driving unprecedented demand for compute and the large-scale data center infrastructure that supports it. Working with Fermi is an important step in expanding infrastructure capacity, allowing us to bring next-generation AI solutions to market. Together, we are enabling customers to deploy AMD-powered AI infrastructure at scale and supporting our continued data center growth momentum." It is worth noting that in August, Fermi announced that the Project Matador campus had signed its first binding customer lease with AI cloud provider TensorWave. According to a statement released by Fermi, the lease was signed by Fermi subsidiary Fermi Campus 1 LLC and TensorWave subsidiary TensorWave TEX1, LLC. The first phase covers a facility supported by 222 megawatts of total power capacity and is expected to generate approximately $6.5 billion in total contracted revenue over an initial 15-year term. The lease includes expansion rights for two additional data centers, and if fully exercised, the partnership between the two parties will expand to more than 650 megawatts across three phases. The tenant under this lease, TensorWave, is a Las Vegas-based AI cloud provider that operates one of the world's largest all-AMD GPU clouds. The company completed a $350 million Series B funding round in June 2026 co-led by AMD Ventures and Magnetar Capital, reaching a valuation of $1.55 billion. TensorWave currently operates three data centers, located in Pennsylvania, Arizona, and Florida, respectively. It has locked in more than 2 gigawatts of long-term data center capacity and has signed leases totaling 500 megawatts of capacity. TensorWave CEO Darrick Horton said: "Our customers need hundreds of thousands of AMD Instinct GPUs in total, and they need a reliable timeline. Fermi has already assembled power, land, and permits and can deliver at that pace." Fermi said at the time in its announcement that it expected part of the lease obligations to be guaranteed by "a global AI leader." The market widely speculated that the guarantor was AMD, citing AMD Ventures' stake in TensorWave and the exclusive supply relationship, but neither AMD nor Fermi confirmed it at the time. Fermi officially referred to the counterparty only as an "investment-grade counterparty." Now, the suspense has finally been revealed, with Fermi confirming that it signed a credit support agreement with AMD to support the lease arrangement for the first phase of the Project Matador campus. AMD's move essentially uses its own balance sheet to backstop the 15-year payment obligations of downstream customer TensorWave, similar to a "vendor financing" structure. This guarantee allows Fermi to obtain project financing and proceed with building out the facility, while TensorWave installing tens of thousands of Instinct GPUs allows AMD to earn back chip revenue. The three-party cooperation also helps strengthen AMD's competitive position in AI infrastructure. But undeniably, it will also intensify market concerns about "circular financing" and add fuel to the bear case against AI trades.