(Reuters) - Chipmaker Advanced Micro Devices shares rose 7 percent in early trading on Monday after the company announced a deal with Samsung Electronics Co Ltd that could allow it to better compete with Nvidia Corp.
As part of the multi-year partnership, AMD will license its custom graphics intellectual property (IP) to Samsung for use in mobile devices, including smartphones. Samsung will pay AMD technology license fees and royalties.
The companies did not disclose the terms of the agreement.
“This strategic partnership will extend the reach of our high-performance Radeon graphics into the mobile market, significantly expanding the Radeon user base and development ecosystem,” AMD Chief Executive Officer Lisa Su said.
AMD’s Radeon graphics cards compete with Nvidia’s gaming chips. The chipmaker sold its mobile graphics technology to Qualcomm Inc in 2009.
The deal represents another win for AMD after the company company’s chips were recently chosen to power Sony’s next generation PlayStation gaming console.
Reporting by Arjun Panchadar in Bengaluru; editing by Patrick Graham and Saumyadeb Chakrabarty