OpenAI today announced plans to buy io Products Inc., a consumer electronics startup led by former Apple Inc. Chief Design Officer Jony Ive.

The deal reportedly values one-year-old io Products at $6.5 billion. OpenAI, which already has a 23% stake in the startup as a result of an earlier investment, will pay $5 billion worth of shares for the remaining 77%. The transaction is expected to close this summer.

In a post on X, OpenAI Chief Executive Officer Sam Altman wrote that Ive will support the ChatGPT developer’s efforts to “create a new generation of AI-powered computers.”

During his nearly 30-year tenure at Apple, Ive played a key role in designing many iPhone, iPad and MacBook models. He also helped develop the blueprints of the company’s $5 billion corporate headquarters. After leaving in 2019, Ive established a design studio called LoveFrom Inc. that counts Airbnb Inc. and Ferrari S.p.A among its clients.

The executive launched io Products last year. Its team reportedly includes about 55 engineers, scientists, researchers, physicists and product development professionals. Those staffers will join OpenAI following the acquisition while Ive is set to take on “deep creative and design responsibilities across OpenAI and io.”

LoveFrom, the design studio that Ive launched after leaving Apple, is reportedly also involved in the transaction. It will receive a stake in OpenAI and the ChatGPT developer will become a client of the studio. Last year, The New York Times reported that companies pay LoveFrom up to $200 million per year to support their product design initiatives.

According to the Wall Street Journal, OpenAI teamed up with LoveFrom two years ago to develop a new consumer device. The paper’s sources said that the gadget is meant “to move consumers beyond screens.” At least one of the product designs that the companies have explored is for a pair of headphones.

When rumors of the acquisition first emerged in April, The Information reported that io Products was developing a consumer device with artificial intelligence features and no display. Some of the publication’s sources said that the gadget resembles a smartphone. Others indicated that io Products was also considering designing smart home products.

According to Bloomberg, the first devices developed through OpenAI’s collaboration with Ive are set to launch next year. The former Apple executive is also expected to become involved in other parts of the AI provider’s business. That includes the development of future ChatGPT releases.

The acquisition comes a few weeks after OpenAI inked another multibillion-dollar acquisition. Earlier this month, it bought developer tooling startup Windsurf in a deal reportedly worth $3 billion. Windsurf, officially Exafunction Inc., provides a code editor that uses AI to automate a range of programming tasks. 

Photo: OpenAI