OpenAI Acquires Jony Ive’s IO in $6.5 Billion Deal to Reimagine AI Hardware
Created on May 21|Last edited on May 21
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OpenAI’s acquisition of IO marks a turning point not just for the company but potentially for the broader tech landscape. The $6.5 billion all-stock deal is the company’s most significant acquisition yet and reflects an increasing urgency to bring AI into the physical world. With ChatGPT already transforming digital interaction, OpenAI is now investing deeply in how people might experience artificial intelligence through purpose-built hardware designed from the ground up.
Inside the IO Team Joining OpenAI
The acquisition brings around 55 employees from IO into OpenAI’s structure. These include experienced engineers and designers, many of whom previously worked closely with Jony Ive during his time at Apple. Names like Scott Cannon, Evans Hankey, and Tang Tan carry significant design and engineering pedigree, and their presence suggests that OpenAI’s new hardware division will be steeped in design discipline and manufacturing insight. This group will anchor their work in San Francisco and collaborate directly with OpenAI’s software and product teams.
Jony Ive’s Role and the Continued Independence of LoveFrom
While Jony Ive will not join OpenAI as an employee, his involvement remains central. His design firm, LoveFrom, will retain its independence but take a lead role in shaping the look, feel, and functionality of OpenAI’s hardware and software products. This arrangement echoes the early Apple-Pixar collaborations and ensures that OpenAI benefits from Ive’s distinctive design ethos without folding him into a traditional executive structure.
A Shared Vision Beyond the Screen
The roots of this collaboration lie in a two-year dialogue between Sam Altman and Jony Ive about what comes after smartphones. Both share a dissatisfaction with the current form of technology, which they see as too noisy, too attention-demanding, and increasingly alienating. Ive has spoken openly about the disquiet he feels using modern devices, describing them as distracting and poorly attuned to human needs. Altman, too, has likened today’s tech environment to sensory overload, pointing to a desire for technology that feels more natural and ambient.
Critique of Current AI Devices and the Promise of Innovation
Ive has been especially blunt in his criticism of current AI-powered gadgets, calling the Humane Pin and Rabbit R1 “very poor products.” He argued these devices lacked originality and failed to imagine new interactions between humans and machines. This acquisition positions OpenAI to address that gap, combining its world-leading AI models with Ive’s commitment to simplicity, clarity, and purpose in product design.
Hints of a Groundbreaking Product
While the specifics remain secret, both Altman and Ive have teased a device that is neither a smartphone replacement nor a traditional screen-based product. Altman has been living with a prototype and describes it as something that redefines what consumer tech can be. Ive has said the project has “completely captured our imagination,” hinting that it could introduce an entirely new interaction paradigm. The product is expected to be revealed in 2026, and while comparisons to the iPhone are inevitable, the team is emphasizing that this is not an iteration of what’s come before but a truly new concept.
Financial Terms and Strategic Context
The $6.5 billion valuation, based on OpenAI’s $300 billion internal mark, underscores the company’s willingness to make big bets. It follows on the heels of other strategic moves, such as the $3 billion acquisition of Windsurf, an AI coding tool. But IO is different in that it is not just about software, compute, or cloud—it’s about shaping how AI gets embodied in everyday life. The deal is entirely stock-based and is expected to close later this summer pending regulatory review.
A Cultural and Technological Convergence
For Jony Ive, this venture represents a culmination of decades of experience. He spoke of feeling that everything he’s learned has led to this point, citing the cultural alignment with Sam Altman and OpenAI as deeply motivating. This acquisition is more than a business deal—it is the coming together of two dominant forces in design and artificial intelligence. With Altman focused on advancing the frontiers of AI and Ive rethinking the objects through which humans interact with it, this collaboration could shape a new generation of computing that is quieter, more intuitive, and more humane.
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