OpenAI Acquires Jony Ive’s Startup in $6.5 Billion Bet on AI Hardware

In a landmark move, OpenAI has confirmed its entry into the hardware space with the $6.5 billion acquisition of io Products, a startup co-founded by legendary Apple designer Jony Ive. This strategic step marks a major expansion for OpenAI, best known for its AI chatbot ChatGPT, as it looks to bring artificial intelligence into physical devices beyond traditional screens.

Rumors first surfaced about two years ago that OpenAI CEO Sam Altman was quietly working with Jony Ive on an AI hardware initiative. Now, that secret has been revealed. Ive, who revolutionized consumer technology with designs like the iPhone, iMac, and MacBook during his Apple tenure, will play a central role in shaping OpenAI’s new product line.

While OpenAI has not disclosed specifics about the upcoming devices, the company described the goal as creating “a new family of products” aimed at integrating AI seamlessly into daily life. Ive’s design firm, LoveFrom, will remain independent, but Ive and his team will take on “deep design and creative responsibilities” across io and OpenAI.

The Details of the Acquisition

OpenAI is paying $5 billion in equity for the acquisition, adding to a 23% stake it already held from a 2023 collaboration with io. The io division will now be led by OpenAI executive Peter Welinder, known for his experience in robotics and early product innovation.

Altman has described this acquisition as potentially the company’s biggest undertaking to date, suggesting it could increase OpenAI’s valuation by as much as $1 trillion. The combined team will include some of the best hardware and software engineers, technologists, scientists, and manufacturing experts, working closely with OpenAI’s research units in San Francisco.

What Could the New AI Hardware Look Like?

Though the exact nature of the new hardware remains under wraps, industry experts speculate the product could be more ambitious than a smartphone. Possibilities range from AI-powered glasses, a car interface, wearable tech similar to Humane AI Pin or Rabbit R1, or even humanoid robots designed to bring AI into the physical world.

Gartner analyst Chirag Dekate noted, “It’s too early to know for sure, but expect physical AI embodiments.” The collaboration between Altman and Ive is described as rooted in “friendship, curiosity and shared values,” signaling a close, long-term partnership.

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