Chipmaker AMD on Monday agreed to acquire World Labs, the artificial intelligence startup founded by renowned researcher Fei-Fei Li, in an all-stock deal valued at $8.2 billion.

As part of the agreement, Li, often called the godmother of AI, will join AMD as executive vice president and chief scientist, reporting directly to chief executive Lisa Su. The deal is expected to close by the end of the year, subject to regulatory approvals.

World Labs builds world models, AI systems that generate and simulate three-dimensional physical environments from text, images and video. Its products include Marble, which turns prompts into editable 3D scenes, and Atlas, a model that reconstructs navigable 3D scenes from a few photos.

Building the compute platforms for the next generation of AI requires a deep understanding of how models are evolving, Su said, adding that the acquisition would help AMD design future chips for physical AI and robotics.

The deal marks one of the largest AI acquisitions of the year and sharpens AMD’s challenge to Nvidia in the market for AI computing infrastructure.