OpenAI has acquired io Products, the hardware startup co-founded by designer Jony Ive, in a $6.5 billion all-stock deal.
This means OpenAI is now moving from just powering AI software to creating the devices that will carry it into people’s lives.
Jony Ive, known globally as the designer behind Apple’s most iconic products, including the iPhone, iPad, and MacBook, has now been appointed to lead creative design at OpenAI. He’s expected to build a new generation of AI-powered consumer devices.
The British designer spent more than two decades at Apple, where his minimalist, user-centred design style defined the look and feel of its products. His partnership with Steve Jobs was highly important in transforming Apple into the world’s most valuable tech company.
After leaving Apple in 2019, he founded LoveFrom, a design firm that later spun off io Products to explore AI-focused hardware.
Now, that entire team, made up of over 50 engineers, designers, and researchers, many of them former Apple staff, is joining OpenAI. The goal is to build hardware that makes interacting with AI natural, seamless, and fully embedded into everyday life.
“We’re using products that are decades old to connect with technology that’s unimaginably new,” said Sam Altman and Jony Ive in a video posted on OpenAI’s blog. “Surely there’s something beyond these legacy products we have.”
Altman confirmed that they are already working on a prototype device but gave no further detail. He described it as “the coolest piece of technology the world will have ever seen.”
With this move, OpenAI wants to break free from the limitations of existing mobile platforms. “OpenAI is interested in owning the next hardware platform so they don’t have to sell their products through Apple iOS or Google’s Android,” said Gil Luria, an analyst at D.A. Davidson.
Recent efforts to create new AI-first devices, like Humane AI’s wearable Pin and Rabbit’s r1 device, have drawn attention but failed to deliver. Humane, launched by former Apple employees, was condemned due to battery life, overheating, and limited features.
The company’s assets were eventually acquired by HP for $116 million, effectively ending its hardware vision.
Rabbit has sold over 100,000 units of its r1 device, but many reviewers say it doesn’t do enough to replace a smartphone.
OpenAI seems determined not to repeat those mistakes. By putting Ive, a designer who has shipped globally successful products, at the centre of its hardware vision, the company is aiming much higher.
This move also ramps up the competition with Apple, which has been slow in rolling out AI features compared to Google and OpenAI. Apple’s share price dropped more than 2% after the announcement.
OpenAI already held a 23% stake in io Products through a previous investment. This acquisition, reportedly worth $5 billion in new equity, is its largest to date. Ive will continue running LoveFrom as a separate entity, while focusing on the new device under OpenAI’s direction.
According to reports, the first product from the new team may arrive in 2026. It’s expected to move users “beyond screens,” offering a new way to experience AI that isn’t tied to traditional phones or laptops.
“Everything I’ve learned over the last 30 years has led me to this place and this moment,” said Ive. “This device has completely captured my imagination.”
OpenAI is building AI by owning not just the software, but the physical tools we use to access it.
