In brief
- OpenAI has acquired Jony Ive’s AI hardware startup io in a $6.4 billion all-equity deal.
- OpenAI CEO Sam Altman said he’s been using an io prototype and called it “the coolest piece of technology the world has ever seen.”
- Apple shares initially dipped nearly 2% following the news.
Get ready for the post-cellphone world. OpenAI today announced the acquisition of io, the year-old AI hardware startup founded by former Apple Chief Design Officer Jony Ive, in an all-equity deal valued at $6.4 billion. The acquisition aims to integrate io’s hardware expertise with OpenAI’s research, engineering, and product teams in San Francisco.
Ive is renowned for his role in designing iconic Apple products, including the original iMac, an innovative, all-in-one computer that helped establish simple, gorgeous, user-friendly design as the hallmark of a company that was mere months away from bankruptcy when Steve Jobs returned from exile in 1997.
The iMac was the first product launched by Jobs, and it helped fuel the company’s legendary turnaround, ultimately making Apple the most valuable company in the world by market cap. Now, with a $3 trillion market cap, it has slipped into the #3 spot, trailing Microsoft and Nvidia—both of whose fortunes rest largely on artificial intelligence.
Apple stock dropped nearly 2% today on the news before recovering somewhat. Apple has struggled to keep up with the fast-changing pace of AI, notably with its “Apple Intelligence” features, which promised a raft of AI-driven new features that have yet to be delivered.
The OpenAI-io merger aims to leapfrog cellphones and keyboard-based computers with a variety of new wearable devices. In a promotional video keyed to today’s announcement, OpenAI CEO Sam Altman said that he’d been using a prototype of an io device.
“Jony called one day and said, ‘This is the best work our team has ever done,’” Altman recalled. “Jony gave me one of the prototypes of the device for the first time to take home, and I’ve been able to live with it, and I think it is the coolest piece of technology that the world has ever seen.”
Added Altman: “The products that we’re using to deliver and connect us to unimaginable technology, they’re decades old. So it’s just common sense to at least think that surely there’s something beyond these legacy products.”
Ive’s secretive company, io, was established with former Apple colleagues Scott Cannon, Evans Hankey, and Tang Tan. The San Francisco-based io team has approximately 55 hardware engineers, software developers, and manufacturing experts. Following the acquisition, Ive’s separate design firm, LoveFrom, will assume design and creative responsibilities across OpenAI’s product lineup.
“I have a growing sense that everything I have learned over the last 30 years has led me to this moment,” said Ive. “While I am both anxious and excited about the responsibility of the substantial work ahead, I am so grateful for the opportunity to be part of such an important collaboration.”
The first products resulting from this collaboration are expected to launch in 2026, marking a significant step in OpenAI’s expansion into consumer hardware.
Edited by Andrew Hayward
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