OpenAI Announces $6.5 Billion Acquisition of AI Hardware Startup Founded by Jony Ive

In its largest acquisition to date, OpenAI has announced it will acquire the AI hardware startup io, co-founded by former Apple Chief Design Officer Jony Ive, in an all-stock deal valued at approximately $6.5 billion. The transaction includes $5 billion for io's equity and accounts for an earlier strategic partnership formed in Q4 2024, during which OpenAI obtained a 23% stake in the company. The deal is expected to close this summer, pending regulatory approval.

Founded a year ago by Ive alongside former Apple colleagues Scott Cannon, Tang Tan, and Evans Hankey, io specializes in AI-driven device development. Following the acquisition, around 55 employees from io—including hardware engineers, software developers, and manufacturing experts—will join OpenAI to build a new class of AI-powered devices envisioned by Ive and OpenAI CEO Sam Altman.

While LoveFrom, Ive’s independent design firm, will not be integrated into OpenAI, it will take charge of the company’s creative direction, including software design. According to OpenAI’s official blog, the io team will work closely with its research, engineering, and product teams based in San Francisco.

This move underscores OpenAI’s strategic shift toward consumer-facing innovation, emphasizing products designed for the mass market. The io acquisition brings new capabilities to develop AI-native hardware that could redefine user interaction and experience.

Altman has explored similar initiatives in the past, including his investment in the startup Humane, which used OpenAI’s technology to launch the Ai Pin, a wearable device positioned as a smartphone alternative, though it failed to gain traction.

For Ive, this acquisition marks a significant return to the consumer technology space. Known for his design leadership behind the iPhone, iPad, iPod, and Apple Watch, Ive shaped the aesthetic and functional language of modern consumer electronics. Within io’s founding team, Hankey succeeded Ive as Apple’s design lead until 2023, while Tang led product design for the iPhone and Apple Watch until 2024.

Ive and Altman anticipate that the first device from the collaboration will debut in 2026. They have been exploring early concepts for nearly two years, aiming to create something fundamentally new. Ive remarked on current market offerings, noting, “People are craving something new, which reflects a discomfort with our current state.”

Altman stated, “Just as smartphones didn’t eliminate laptops, I don’t think our first product will make smartphones obsolete. This is something entirely new.” Ive added that smartphones remain “remarkable general-purpose devices,” but emphasized that users will engage with AI “in very new ways.”

According to media sources, Altman and LoveFrom have been working on a confidential project involving new hardware that would free users from screen dependency, with concepts including headsets and camera-equipped devices already under consideration.