OpenAI is developing a smartphone intended to directly compete with the iPhone, which appears to be a significant departure from the company’s previously announced hardware strategy. Here’s everything we know so far.
Analyst Ming-Chi Kuo released his findings in late April following supply chain audits, describing the device as an “AI agent phone” built around a continuous, context-aware interface rather than individual apps. Kuo argued that the smartphone is the only device that captures the complete real-time state of a user, including location, activity, communication and context, making it particularly suitable for AI agent inference.
He said that full control of the operating system and hardware was the only way for OpenAI to provide a full AI agent service, and that AI agents would fundamentally change the way people interact with a phone, moving from launching individual apps to performing tasks through a seamless interface.
Features
OpenAI’s phone would use a custom version of MediaTek’s Dimensity 9600 processor, built on TSMC’s N2P node in the second half of 2026. Kuo initially named MediaTek and Qualcomm as chip partners, but has since said that MediaTek appears “best positioned to become the sole processor supplier.”
Luxshare Precision Industry is considered the exclusive manufacturing partner. Separately, Kuo reported that Sunny Optical has secured component orders for two OpenAI devices, including the smartphone. It’s probably for the camera module.
The main known hardware specification of the device today is its image signal processor, which includes an improved HDR pipeline intended to improve real-world sensing through the camera. It is also said to use two AI processors to handle different tasks simultaneously, such as vision and language processing, along with fast memory and storage and security features to isolate processes.
What about Jony Ive’s devices?
The phone represents a notable reversal in OpenAI’s publicly announced strategy. The company’s hardware ambitions had previously been described as centering on non-phone form factors developed with former Apple design chief Jony Ive, whose io Products startup OpenAI acquired for $6.5 billion in May 2025. Ive and CEO Sam Altman had specifically said they didn’t want to build a device with a screen, with Altman describing a prototype to employees as “the coolest piece of technology the world has ever seen.”
The first product from this collaboration was delayed from 2026 and has since been identified as a smart speaker with a built-in camera, priced between $200 and $300 and expected to launch in early 2027. Other devices reportedly in development include smart glasses, a smart lamp and potentially headphones, although these products are further along the roadmap and some could be canceled.
OpenAI has also recruited aggressively from Apple’s hardware ranks, hiring more than 40 former Apple employees. The hires include former Apple designers Evans Hankey, Tang Tan and Scott Cannon, prompting Apple to offer its iPhone product design team retention bonuses of up to $400,000 in restricted stock units to counter poaching.
Chronology
Mass production of OpenAI’s smartphone was initially planned for 2028, but Kuo has since revised his expectations to the first half of 2027. The accelerated timeline would reflect OpenAI’s planned IPO, where a compelling hardware product could bolster the company’s investor pitch, as well as intensify competition in the AI ​​agent phone category. Combined deliveries from the Kuo projects for 2027 and 2028 could reach around 30 million units if development remains on track.
What does this mean for Apple?
If a wider range of hardware ships, OpenAI will be a direct competitor to Apple in several product categories. Apple is rumored to be developing smart glasses, AirPods with cameras, an AI pendant, and a smart home hub with enhanced Siri capabilities. The day Kuo released his initial report, Altman posted on X that “this seems like a good time to seriously rethink how operating systems and user interfaces are designed.”
