[News] OpenAI Acquires Startup Co-Founded by Apple Design Icon Jony Ive in Ambitious AI Hardware Push

OpenAI will acquire io, an AI device startup co-founded by former Apple design chief Jony Ive, in an all-stock deal valued at nearly USD 6.5 billion, according to a report from Economic Daily News citing Bloomberg. The transaction marks OpenAI’s largest acquisition to date and signals its formal entry into the hardware sector in partnership with the iconic designer, the report notes.

The deal will create a dedicated hardware division within OpenAI, responsible for developing a lineup of AI-driven consumer devices envisioned by Jony Ive and CEO Sam Altman. The first products are expected to launch next year, the report adds.

Jony Ive, renowned for defining the aesthetics of modern smartphones through iconic Apple products such as the iPod, iPad, and Apple Watch, departed the company in 2019. His collaboration with OpenAI marks a high-profile return to the consumer tech industry he helped shape, as the report indicates.

Once described by Steve Jobs as his “spiritual partner,” Ive is now bringing his design expertise to a competing platform—a move Bloomberg suggests may spell trouble for Apple, particularly as the company faces challenges in the evolving AI landscape.

Apple’s AI platform, launched last year, falls short of competing systems and partly depends on OpenAI’s ChatGPT to bridge its limitations, according to Bloomberg.

Under the terms of the agreement, OpenAI will acquire io through a USD 5 billion stock transaction. The total deal value, which approaches USD 6.5 billion, includes an earlier agreement struck in Q4 of last year, when OpenAI acquired a 23% stake in io, the report mentions.

The acquisition is expected to close this summer. Once completed, OpenAI will gain a team of around 55 engineers, software developers, and manufacturing specialists from io, as noted in the report.

Ive and Altman have not disclosed details about the hardware they’re developing, but they’re entering an emerging market. As the report notes, Meta—parent company of Facebook and Instagram—is currently one of the most prominent players in AI devices.

As CNBC highlights, OpenAI has been advancing its hardware ambitions. In November 2024, it brought on the former head of Meta’s Orion AR glasses project to lead its robotics and consumer hardware initiatives. That same month, it also invested in San Francisco–based robotics startup Physical Intelligence.

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(Photo credit: OpenAI)