• OpenAI makes its largest acquisition to date, agreeing to buy hardware startup io for nearly $6.5 billion in stock.
  • The deal brings on roughly 55 ex-Apple engineers and designers, including key figures behind the iPhone and MacBook.
  • Manufacturing is expected to shift outside of China, with Vietnam a likely candidate, aiming for mass production of a new AI device category by 2027.

OpenAI has agreed to acquire hardware startup io in an all-stock deal valued at nearly $6.5 billion, according to people familiar with the matter, marking a massive strategic bet on consumer AI hardware and a significant raid on Apple's talent pool. The acquisition, which is still pending regulatory approval, represents the ChatGPT maker's largest to date and accelerates its push beyond software into physical devices.

The io team, which includes approximately 55 members, is packed with former Apple engineers and designers who worked on landmark products. This talent infusion is a central pillar of the deal, giving OpenAI immediate and deep hardware expertise. Jony Ive's design firm, LoveFrom, while remaining independent, is set to take a leading role in product design for the new venture, according to people briefed on the partnership.

The new hardware division will be led by OpenAI Vice President of Product Peter Welinder. He will be joined by a leadership team with deep Apple roots, including Scott Cannon, Evans Hankey, and Tang Tan. This move signals a major corporate restructuring for OpenAI as it builds out a capability entirely new to the company.

Efforts to develop a new category of AI-powered consumer device are already underway. Early designs point toward a compact, wearable device that could operate without a traditional display, instead relying on cameras and microphones to interact with users through generative AI. People involved in the early manufacturing discussions say production is likely to be located outside of China, with Vietnam emerging as a strong candidate, a shift that reflects broader geopolitical tensions and a desire to diversify supply chains.

The ambitious product roadmap targets sales of up to 100 million units, aiming for mass consumer adoption. A first prototype could be unveiled as early as 2026, with mass production potentially following in 2027, though these timelines remain fluid, according to those familiar with the planning.

OpenAI and LoveFrom did not immediately respond to requests for comment. The aggressive hiring and acquisition spree highlights the intense competition among tech giants to define the next generation of personal computing, moving AI from the cloud into everyday physical objects. However, the path is fraught with risk; recent consumer AI hardware launches, like the Humane AI Pin and Rabbit R1, have struggled to gain traction with critics and early users.