AMD buys firm founded by AI 'godmother' Fei-Fei Li

Chip maker Advanced Micro Devices announced Monday it has acquired World Labs, an artificial intelligence company founded by Fei-Fei Li, one of the field's most prominent researchers, sometimes referred to as "The Godmother of AI."

The deal is valued at approximately $8.2 billion and will make Li, a Stanford computer science professor, chief scientist at AMD.

Li founded World Labs to develop what she calls "spatial intelligence" -- technology that can simulate 3D environments from images, video and text.

The company researches so-called world models, which work differently than the popular AI systems that generate text and images.

Instead of creating new content, world models learn how the physical world actually works so they can simulate and predict what happens.

The research has applications in robotics and virtual simulations.

"Now that we have tangible proof of the possibilities, we want to do everything we can to accelerate the future," Li said in a blog post.

"To do this requires scaling our efforts, widening our reach, and getting closer to the hardware."

AMD this month became the latest equity to reach a $1 trillion valuation due to the massive investment boom over artificial intelligence.

Even with the latest surge, AMD's valuation significantly trails rival chip company Nvidia, considered the pace-setter in artificial intelligence.