OpenAI Dives Into Hardware With Reportedly $6.5 Billion Acquisition — This ‘Family of AI Products’ Better Be Awesome

Jony Ive, who’s sold a company called io to OpenAI at a reportedly $6.5 billion valuation. Photo Credit: Marcus Dawes

Welcome to the hardware world, OpenAI: The artificial intelligence giant has acquired a startup, reportedly valued at $6.5 billion, founded by Apple vet Jony Ive. But is the play indicative of an AI bubble?

Ive and OpenAI head Sam Altman announced the agreement in a brief release as well as a 10-minute video. Described by some as one of the iPhone’s main designers, Ive (and his LoveFrom “creative collective”) “quietly began collaborating” with OpenAI and Altman two years back, the parties indicated.

As those involved tell the story, the talks set the stage for Ive to launch a hardware-focused venture called io last year. (Not directly mentioned is the 23% io interest OpenAI promptly scooped up, with today’s deal covering the remaining stake, per the Wall Street Journal.)

“It became clear that our ambitions to develop, engineer and manufacture a new family of products demanded an entirely new company,” Altman and Ive explained of io’s conception.

Now, Ive and his approximately 55-person io staff will come aboard OpenAI, with the mentioned LoveFrom taking a stake in the ChatGPT developer but remaining independent, per the Journal.

The same outlet and OpenAI itself didn’t shed too much light on what’s in the cards for io post-purchase; the Journal, citing anonymous sources, only noted that Ive will have a hand in “all” OpenAI’s ventures, from ChatGPT to the app and more.

But that probably doesn’t need saying given the astonishing $6.5 billion io valuation floating around. Also implied are the decidedly high expectations associated with OpenAI’s forthcoming hardware, which could include headphones and cameras.

While far from impartial, the above-noted video saw Altman disclose that he’d already tested one of the upcoming physical products. Part of a “family” of hardware, this device represents “the coolest piece of technology that the world will have ever seen,” he touted.

In any event, the purchase announcement underscores the ample capital floating around the AI sector – and raises questions about the initially mentioned possibility of a bubble. For better or worse, the rapidly evolving technology appears here to stay.

As is often the case, however, two things can simultaneously be true; AI’s quick-improving features and long-term relevance don’t mean there isn’t a bubble in the space.

Though time will tell how the well-financed episode plays out, OpenAI’s gargantuan valuation, Perplexity’s $14 billion value, the $5 billion at which legal-focused Harvey AI may raise capital, and a whole lot else are certainly worth keeping in mind.

Link to the source article – https://www.digitalmusicnews.com/2025/05/22/openai-io-acquisition/