OpenAI is planning to launch its own artificial intelligence (AI) smartphone by 2028, according to supply chain analyst Ming-Chi Kuo. The company is co-developing a custom processor with MediaTek and Qualcomm, with Luxshare handling system design and manufacturing. Mass production of the chipset is expected in 2028, with suppliers locked in by late 2026 or early 2027.

Why Is OpenAI Building a Smartphone?

The reasoning behind OpenAI's hardware ambitions centers on a fundamental shift in how people interact with technology. Kuo noted that AI agents are quietly redefining what a phone is, and users no longer want to juggle between a "pile of apps." Instead, people want tasks completed seamlessly, with the interface adapting to their needs.

To achieve this vision, OpenAI would need control over both the operating system (OS) and the hardware itself, allowing the company to integrate AI agents directly into the phone's real-time context. The company would also prioritize power consumption, memory hierarchy, and on-device small-model execution, with heavier computational tasks sent to cloud-based AI systems.

OpenAI CEO Sam Altman appeared to hint at this strategy in a recent post on X, stating that the time has come to "seriously rethink how operating systems and user interfaces are designed." Altman also floated the idea of a new internet protocol that works for both people and agents, a post made just hours before Kuo's leak.

What Other AI Devices Is OpenAI Developing?

The smartphone is just one piece of a larger hardware strategy. OpenAI acquired Jony Ive's startup IO in 2025 to build a screenless AI device, separate from the rumored smartphone. The company is reportedly building a "family" of AI devices, including smart glasses and an audio-only device called "Dime." OpenAI's first companion device might launch in 2027, though nothing has shipped yet.

• Smartphone: Custom processor co-developed with MediaTek and Qualcomm, targeting mass production in 2028
• Screenless AI Device: Developed through the acquisition of Jony Ive's startup IO, potentially launching in 2027
• Smart Glasses: Part of OpenAI's broader hardware roadmap for AI-powered wearables
• Audio-Only Device (Dime): A voice-focused AI device designed for hands-free interaction

How to Understand OpenAI's Hardware Strategy

• Vertical Integration: OpenAI is taking control of both software and hardware to ensure AI agents work seamlessly across devices without relying on third-party app ecosystems
• On-Device Processing: The custom chipset will prioritize running smaller AI models locally on the phone, reducing latency and improving privacy while cloud systems handle heavier computational tasks
• Market Positioning: OpenAI is targeting the high-end smartphone segment, which moves between 300 to 400 million units per year globally, positioning itself as a premium alternative to existing smartphone makers

However, there's a significant caveat to OpenAI's hardware ambitions. The company has spent recent months actively cutting what it calls "side quests," shutting down the Sora video generation app and pausing many new features to focus on building a "superapp." Against this backdrop, it remains unclear whether OpenAI's hardware ambitions will actually materialize into consumer products.

Until OpenAI actually ships a consumer device, these claims should be taken with caution. The company has a history of ambitious announcements, and the smartphone market is notoriously competitive. Yet the timing of Altman's public comments about rethinking operating systems, combined with Kuo's detailed supply chain reporting, suggests OpenAI is serious about this pivot from pure software to integrated hardware and software solutions.