What happened

Investors can't get enough of stocks associated with artificial intelligence (AI) these days. On Thursday, veteran chipmaker American Micro Devices (AMD -10.21%) benefited from this after the publication of a media report stating it had found a powerful partner to help it with its AI chip efforts. AMD stock rose to close the day nearly 7% higher, in favorable contrast to the 0.7% decline of the S&P 500 index. 

So what

That morning, citing unidentified "people with knowledge of the matter," Bloomberg wrote that AMD has teamed up with none other than Microsoft (MSFT -1.33%) in its AI chip efforts. According to the article's sources, AMD and Microsoft have joined forces to develop highly AI-capable chips.

The tech giant is providing financial support to the chipmaker, and the two companies are working on a Microsoft processor designed specifically for AI capabilities. This is code-named Athena.

Microsoft has been on the forefront of AI development with its $10 billion investment in OpenAI, the developer of the white-hot ChatGPT chatbot that has dominated talk in many tech circles. Given that level of commitment, it's not surprising to learn that the company is apparently spending capital on the hardware side, too.

Now what

Neither AMD nor Microsoft has yet officially commented on the Bloomberg report. Additionally, the article didn't put a figure on how much Microsoft is investing into this AI chip collaboration.

If accurate, it's excellent news for AMD and indicates that it's poised to be a force in AI processors -- particularly with a mighty partner like Microsoft by its side.