TensorWave Raises 100 Million to Expand AMD-Powered AI Data Centers

TensorWave, a data center provider specializing in AMD hardware, has secured a $100 million funding round led by Magnetar and AMD Ventures. This latest investment brings the company’s total capital raised to $146.7 million, enabling it to accelerate the expansion of its AI-focused data center infrastructure.

The funding comes at a challenging time for data center projects, with tariff-related price increases on components like server racks and chips pushing build costs up by 5% to 15%. Additionally, investors remain cautious about overcapacity risks, especially as affordable AI services proliferate, causing delays in large-scale projects such as OpenAI’s Stargate data center.

Despite these headwinds, TensorWave reports strong business momentum, projecting a run-rate revenue exceeding $100 million by year-end—a 20-fold increase from the previous year. The company’s CEO, Darrick Horton, emphasizes TensorWave’s commitment to democratizing access to cutting-edge AI compute through its AMD-powered infrastructure.

TensorWave’s strategy diverges from the industry norm, where Nvidia dominates AI training hardware. Instead, TensorWave leverages AMD’s Instinct MI325X GPUs to offer more cost-effective cloud AI services. The company recently deployed a dedicated training cluster with approximately 8,000 AMD GPUs and plans to expand this cluster with the new funding.

The capital infusion will also support headcount growth, with TensorWave aiming to increase its team from around 40 to over 100 employees by the end of the year. This expansion is critical to sustaining operational growth and establishing TensorWave as a leading AMD-powered AI infrastructure provider.

TensorWave was founded in 2023 by Darrick Horton, Jeff Tatarchuk, and Piotr Tomasik, entrepreneurs with backgrounds in cloud services, crypto mining, and digital marketing. Their combined expertise positions TensorWave to innovate in the competitive AI data center landscape.

Other data center providers, from startups like Lamini and Nscale to established cloud giants such as Azure and Oracle, are also investing in AMD’s AI chips. TensorWave’s early commitment to AMD hardware highlights a growing trend toward diversifying AI infrastructure beyond Nvidia dominance.

As AI workloads continue to expand, cost-effective and scalable data center solutions like those offered by TensorWave will be crucial for democratizing AI access and supporting the next generation of AI applications. Navigating component cost inflation and capacity risks will remain key challenges for the industry.