Openai takes over IO: The 6.5 billion dollar deal for the reinvention of the AI hardware
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Published on: May 25, 2025 / update from: May 25, 2025 - Author: Konrad Wolfenstein
Openai takes over IO: The 6.5 billion dollar deal for the reinvention of the AI hardware-Image: Xpert.digital
From software to hardware: Openai invests billions in a new AI age
AI meets design: Openaai plans groundbreaking devices for the next generation
With the takeover of the hardware startup IO of ex-Apple chief designer Jony Ive, Openaai took a pioneering step into the hardware area. The 6.5 billion US dollar not only marks the largest acquisition in the history of Openai, but also signals a fundamental change of strategy from the AI pioneer away from pure software solutions to a comprehensive product philosophy for the AI age. The takeover combines the revolutionary AI technology of Openai with the legendary design expertise of the man who shaped the iPhone and promises a completely new generation of AI-controlled devices that are scheduled to come onto the market in 2026.
The takeover in detail
With a volume of $ 6.5 billion, the transaction between Openai and IO represents the largest acquisition in the history of Openaai. The deal is completely handled in the form of a stock exchange, which means that Jony IVE and its partners are currently in shares in Openai, which is currently valued with $ 260 to $ 300 billion. It is interesting that Openaai has held a 23 percent share of IO since 2024, which reduces the amount actually paid to about $ 5 billion.
The transaction is expected for the summer of 2025, subject to official permits. This takeover is followed by the recent purchase of windsurf, a AI-supported coding tool, for $ 3 billion, which illustrates OpenAis aggressive expansion strategy. Cooperation between the two companies began two years ago as a relaxed cooperation between Ives design studio LoveFrom and Openaai, but quickly developed into concrete product plans.
Key persons and teams
At the center of the takeover is Jony Ive, the British designer, who is considered one of the most influential product designers in modern technology history. IVE worked at Apple from 1992 to 2019 and was responsible for the design of iconic products such as iMac, iPod, iPhone, iPad and Apple Watch as Chief Design Officer. Steve Jobs once described him as his "spiritual partner" and emphasized that the influence that Jony did not only have with Apple but in the world was enormous.
With the takeover, about 55 hardware engineers, software developers and manufacturing experts from IO to Openaai. Among them are prominent former Apple executives such as Scott Cannon, Evans Hankey and Tang Tang, all of whom held important roles in the design team during the time at Apple. This constellation promises a seamless integration of Apple's legendary design philosophy in Openais AI vision.
A special agreement stipulates that IVE itself will not start directly at Openaai, but will act as an external partner with his design company LoveFrom, founded in 2019. LOVEFROM will in future look after the entire design of Openai - both hardware and software - and will remain independent in order to be able to operate other customers. This enables close cooperation, while at the same time IVES is preserved.
Io and the product vision
The startup IO, founded by Jony Ive in 2024, specializes in the development of AI-controlled hardware products, which are intended to enable completely new ways of human-computer interaction. So far, the company has neither launched products nor produced sales, which makes the valuation of $ 6.5 billion all the more impressive. However, the development of the first devices has already progressed well, as Sam Altman confirmed in a joint video statement with IVE: he was able to take a prototype home with him and try it out.
The vision of IO is based on the conviction that despite the unprecedented skills of modern AI - computers can now see, think and understand - our experience is still shaped by traditional products and interfaces. The planned devices should not replace smartphones, but should exist in parallel to them and enable completely new forms of interaction. Altman describes the objective as follows: "We are still in the terminal phase of the AI interactions. We have not yet found out what the equivalent will be on the graphical user interface, but we will.
The first products are expected to come onto the market in 2026. According to reports, it is said to be devices that are "less socially disruptive than the iPhone" and should lead users "beyond screens". Speculations range from headphones and other camera -deprived devices to a wide product portfolio that could include smartwatches, headsets and even humanoid robots. Altman already raves about the first prototypes: "I think it's the coolest piece of technology that the world will ever see".
Strategic importance for Openaai
The takeover of IO marks a fundamental change of strategy for Openaai, which now wants to go beyond its previous software solutions such as chatt and image generators. Sam Altman pursues the vision of creating AI devices that could fundamentally redefine computing. Already at the beginning of the year, Altman emphasized: "AI needs a new terminal because the way people interact with computers.
This strategy reflects Openais ambitions not only to stay a AI software company, but also to develop into a comprehensive technology group that controls the entire value chain from AI development to hardware. The integration of Ives Team should enable close toothing with research, technology and product development at Openai. At the same time, Openai develops its own AI chips to reduce the dependency on the chip manufacturer Nvidia.
The takeover also strategically positions Openai against his previous partner Apple. So far, the two companies cooperated in the integration of the AI model GPT in Apple's assistant Siri, but now Openai could become a direct competitor in the hardware area. This shift in power in the tech sector could have far-reaching consequences for the entire industry.
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Financing aspects and evaluation
The financing of the 6.5 billion dollar takeover raises interesting questions about Openai's financial situation. The company fully wraps the deal through stocks, which means that no cash flow, but the ownai's property structure is changed. With a current rating of $ 260 to $ 300 billion, Openai has significant stock resources to finance such strategic acquisitions.
The evaluation of IO is particularly noteworthy, since the startup has so far not been able to show any products or sales. This evaluation is based exclusively on the potential of technology, the reputation of the participating designers and engineers as well as the strategic advantages for Openai. The fact that Openaai already had a 23 percent share suggests that the company had a complete takeover from the start.
The takeover is part of a series of significant investments and acquisitions that Openai has made in recent months. After buying windsurf for $ 3 billion, the company shows its willingness to invest considerable resources in strategic takeovers in order to strengthen its market position.
Market effects and competition
The announcement of the takeover had an immediate impact on the stock markets. On the day of the announcement, Apple's share fell by over two percent, which reflects the fears of investors about possible competition with Apple's established product lines. This market reaction underlines the perceived threat that Openai's entry into the hardware area for established tech companies could be.
The takeover positions Openai in direct competition with other tech giants who also work on AI hardware. Google has recently invested in a glasses manufacturer, while Meta has already received an extensive partnership with Ray-Ban for Smart Glasses. These developments indicate an intensive race for supremacy in the area of AI-based consumer electronics.
The contrast to previous failed AI hardware tests is particularly interesting. Products such as the Humane Ai PIN and Rabbit R1 have failed spectacularly on the market. Jony Ive sharply criticized these products as "very bad products" and complained "a lack of new thinking in products". This criticism underlines Openai and IO's claim to avoid the previous mistakes and create real innovations.
Future prospects and challenges
The first joint products from Openaai and IO are expected to come onto the market in 2026. This schedule gives the teams about a year to implement their visions into market maturity products. The challenge is to develop devices that are not only technically innovative, but also actually offer added value for consumers and can prevail on the market.
The cooperation between IVE and Altman is based on a personal friendship and the common desire to "create amazing products that advance humanity". Ive expressed in a joint interview: "I am increasingly feeling that everything I have learned in the past 30 years has led to this place and at that moment". This emotional component could be an important success factor for the partnership.
However, there are considerable challenges. The development of hardware is complex and costly, and the ACI market is not yet established. Openai has to prove that it not only develops excellent software, but can also successfully design, produce and market hardware. The integration of 55 new employees into the existing corporate structure represents additional organizational challenges.
Partnership with potential: Openaai and Jony Ive set new standards
The takeover of IO by Openai for $ 6.5 billion is a turning point in the development of the AI industry. The combination of Openai's revolutionary AI technology with Jony Ives legendary design expertise that has a partnership that the potential has to change the way people with technology interact. The complete handling as a share deal and the strategic integration of 55 specialists show OpenAis serious intent to develop from a pure software company to a comprehensive technology group.
While the planned products awaken great expectations for 2026 and Altman already raves about the "coolest piece of technology that the world will ever see", the concrete details remain secret. The challenge will be to put the highly plugged visions into marketable products that stand out from the failed AI hardware attempts from the past. However, the market reactions, in particular the drop in the price at Apple, already illustrate the disruptive force that could assume this partnership. Ultimately, this takeover could mark the beginning of a new era, in which AI is no longer only integrated into our daily life by software, but by completely new hardware forms.
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