OpenAI has announced the acquisition of a startup founded by former Apple design chief Jony Ive that is developing AI devices. The deal is valued at $6.5bn, according to WSJ.
Sam Altman’s firm will acquire io in exchange for equity worth $5bn, as it already owns 23% of the shares. Ive’s startup has about 55 engineers, scientists, researchers, physicists and product developers. His second company, LoveFrom, will continue to operate independently.
Ive’s collaboration with Altman began two years ago, said OpenAI’s blog. After the merger, the former Apple executive and his firm LoveFrom will take on key design and creative roles.
thrilled to be partnering with jony, imo the greatest designer in the world.
excited to try to create a new generation of AI-powered computers. pic.twitter.com/IPZBNrz1jQ
— Sam Altman (@sama) May 21, 2025
“I am thrilled to be partnering with Jony, in my opinion, the greatest designer. We are excited to try to create a new generation of AI‑powered computers,” Altman said.
OpenAI will become a client of LoveFrom, and LoveFrom will receive a stake in the startup. Closing is planned for the summer, subject to regulatory approval.
WSJ noted that the entrepreneurs have secretly worked for two years on a classified project — a new device that “will allow consumers to go beyond screens”.
Jonathan Ive will oversee the design of all OpenAI products — from future versions of ChatGPT to audio features, the mobile app and other developments.
He is credited with iconic Apple products such as the iPod, iPhone, iPad and MacBook Air. Ive also played a key role in designing Apple’s new headquarters in Cupertino — Apple Park. Work on the project began in 2004, and the campus officially opened in 2019.
100m ‘AI companions’
According to the media, Altman gave employees a preliminary overview of devices he is developing with Ive and shared plans to release 100m “AI companions”. He hopes they will become part of people’s daily lives.
Altman said OpenAI staff “have a chance to do the biggest thing they have ever done”. Buying io could lift the firm’s valuation to $1trn, he believes.
The new product could be fully aware of its surroundings and the user’s life. It is unobtrusive, can sit in a pocket or on a desk, and “will become the third primary device after the MacBook Pro and iPhone”.
It will not be a phone, glasses or anything worn on the body — Ive and Altman want to wean people off screens, WSJ notes. This is about a “new design movement”.
The OpenAI CEO stressed that a whole “line of devices” is planned, comparing the concept to Apple’s ecosystem. Privacy is crucial to the project’s success, he said — otherwise competitors could copy the product before it reaches the market.
For several months, Ive’s team has been in talks with suppliers to ensure large‑scale deliveries of the device.
“We are not going to ship 100m on day one,” Altman said.
According to him, OpenAI will make that many gadgets “faster than any company that has ever shipped 100m new devices”.
The device is slated for release at the end of 2026.
Initially, Ive’s startup planned to develop and sell its own device using OpenAI technology. It later became clear that model would not work. Altman said he knew the two companies needed to combine — the device is not just an accessory but a central aspect of users’ relationship with his startup.
AI devices — a threat to the iPhone
The world of AI wearables is nascent but is drawing the attention of tech giants and entrepreneurs.
Altman earlier was among the first investors in Humane — another company founded by former Apple employees. It built an AI gadget with a projector, but after a series of setbacks it was pulled from production and the firm was sold.
Other form factors for AI devices look more promising.
Meta’s smart glasses are in demand and receive mostly positive reviews. In September 2024, the company updated them, adding real‑time video processing, reminders, translation and integration with music apps.
“Technology shifts like the internet, the smartphone and AI happen once a generation. OpenAI is turning this shift into something tangible. Before AI there was no real threat to the businesses of Apple or Google. The emergence of AI led by OpenAI is the first serious threat in the last 20 years,” said Apple analyst Gene Munster.
In May 2025, the company’s senior vice president of services Eddy Cue said that technology is changing too quickly and within a few years people may stop using the devices that are commonplace today.
“Maybe in 10 years you won’t need an iPhone, as crazy as that sounds. Real competition is only possible when technology shifts. They create those opportunities. AI is a new technology shift and it creates new opportunities for new entrants,” he said.
Meanwhile, Apple itself is working on new chips for smart glasses that use cameras to scan the surroundings and rely on artificial intelligence to assist the user.
In May, Google joined the smart‑glasses race, announcing partnerships with Gentle Monster and Warby Parker to build a gadget on Android XR. It showed a concept device with Gemini AI. The glasses have a camera, microphone, speakers and a display for viewing notifications.
In September 2024, Ive confirmed he was working on a new AI device with OpenAI.