Friday, July 4, 2025

Jony Ive Joins OpenAI in $6.4B Deal to Shape AI Hardware Future

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OpenAI revealed on Wednesday that its plans to acquire io, an AI device startup founded by Jony Ive, renowned for designing the iPhone, for 6.4 billion USD.

This acquisition marks a significant step for OpenAI, the company that pioneered the AI era with ChatGPT-3, towards building an AI ecosystem that incorporates AI into hardware.

OpenAI’s Biggest M&A Deal Ever

OpenAI decided to acquire io in exchange for its own shares.

In a statement, OpenAI emphasized that Ive is taking on “deep creative and design responsibilities across OpenAI and io,” and that while the two companies will merge, Ive and his “creative collective” called LoveFrom will remain independent.

CNBC reported that this acquisition is OpenAI’s largest M&A deal to date.

OpenAI is undertaking its largest M&A just weeks after agreeing to acquire Windsurf, an AI coding firm, for 3 billion USD, showcasing the company’s aggressive expansion strategy.

Last year, OpenAI also acquired Rockset, an analytics database firm, for an undisclosed amount.

Apple’s Former Chief Designer

Ive built his reputation as the designer of Apple’s iPhone. In 2019, he stepped down from his role as Apple’s Chief Design Officer (CDO) to establish Love From.

According to the New York Times, Love From has been generating up to 200 million USD annually from its clients. At the time, LoveFrom handled projects for Christie’s, Airbnb, and Ferrari.

Airbnb had previously stated in 2020 that Ive was consulting on their employment strategies and future product development.

Ive was the design chief for iconic Apple products such as the iPod, iPhone, iPad, and MacBook Air. He also contributed to the design of Apple Park, Apple’s headquarters in Cupertino, California. The construction of Apple Park began in 2004 and was officially completed in 2019.

AI Meets Hardware

OpenAI, which spearheaded the current AI revolution, recently saw its valuation skyrocket to 300 billion USD following a capital raise led by SoftBank.

Despite its pioneering role in the AI era, OpenAI faces fierce competition from tech giants like Google, emerging players like Anthropic, and Elon Musk’s xAI in the rapidly evolving generative AI market. All these companies are investing heavily and continuously launching innovative products.

OpenAI’s foray into hardware appears to be a strategic move to maintain its competitive edge.

In November last year, OpenAI recruited Caitlin Kalinowski, who previously led Meta Platforms’ augmented reality (AR) glasses initiative, to head its robotics and consumer hardware divisions. Kalinowski described her role as focusing on OpenAI’s robotics sector while working collaboratively to apply AI to the physical world and help humanity benefit from it.

To support this initiative, OpenAI invested in Physical Intelligence, a San Francisco-based robotics startup, late last year.

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