OpenAI's $6.4B acquisition

👋 Good morning/evening (wherever you are). It’s Wednesday.

About two years ago, Jony Ive’s son was so impressed by ChatGPT that he told his dad, “You’ve got to meet Sam.”

That introduction led to a meeting between Ive, Apple’s former design chief, and Sam Altman, CEO of OpenAI.

The two agreed the AI era demanded a new generation of hardware.

In 2024, Ive launched io, an AI device startup, alongside former Apple collaborators Scott Cannon, Evans Hankey, and Tang Tan.

Their mission: to build groundbreaking products for the AGI era.

OpenAI is now acquiring io in an all-equity deal worth just under $6.5 billion — its largest acquisition to date. The io team will become OpenAI’s devices division, led by Peter Welinder, who reports to Altman.

Ive will not join OpenAI but will lead design and creative efforts through his independent firm LoveFrom, which remains separate from io.

The first io product reveal is expected in 2026.

Official announcement here.

Switching gears:

Curious to know how good AI video is now?

Watch this video (posted on LinkedIn). It’s one of the most jaw-dropping Veo 3 demos right now.

OK let’s keep going ↓

Here’s what you should know:

• Klarna used an AI avatar of its CEO to deliver earnings

  It credited its use of AI for a fourth consecutive profitable quarter, explaining that it “streamlined its workforce by ~40%.”

• Shopify debuts AI store builder for merchants

  From Shopify’s Edition launch day, the company’s biannual announcement that showcases recent changes to the platform.

• Amazon rolls out short-form AI audio summaries

  The new AI shopping experts help save time by compiling research and providing product highlights for customers from product pages, reviews, and insights.

• Microsoft’s Aurora AI foundation model goes beyond weather forecasting

  Aurora leverages the latest advances in AI to more accurately predict not just the weather, but a wide range of environmental events in a series of retrospective analyses — from hurricanes and typhoons to air quality and ocean waves.

• Mistral AI launches Devstral, a new open source SWE agent

  Devstral achieves a score of 46.8% on the SWE-Bench Verified benchmark, a dataset of 500 real-world GitHub issues manually validated for correctness. This places it ahead of all previously released open-source models and ahead of several closed models, including GPT-4.1-mini, which it surpasses by over 20 percentage points.

• Nvidia’s Chief says U.S. chip controls on China have backfired

  Jensen Huang, the chipmaker’s top executive, said the attempt to cut off the flow of advanced A.I. chips spurred Chinese companies to “accelerate their development.”

• RBC sets up new AI team for capital markets unit

  Royal Bank of Canada's capital markets wing has established a new artificial intelligence and digital innovation team as it bets on AI to boost future growth, the Canadian lender told Reuters on Wednesday.

• China warns legal action against US enforcers restricting Huawei AI chips

  China warned US enforcers that restricting Huawei AI chips can now lead to legal action. It has said the US’s latest move is unilateral bullying and protectionism.

• Meta introduces the Llama Startup Program

  Meta’s new initiative to empower early-stage startups to innovate and build generative AI applications with Llama.

• Google is bringing ads to AI Mode

  Ads may appear “where relevant” below and “integrated into” AI Mode responses as part of a test, Google says.

• Uber Freight wants to be “AI-led”

  Uber is launching “the industry’s first scaled AI logistics network that combines intelligence, automation, and human expertise.”

The numbers:

• Italy’s Synapsia has reached a $2.5B agreement with Bold Technologies of the United Arab Emirates to provide AI-driven city management services in Abu Dhabi.

• Once worth over $1B, Microsoft-backed Builder.ai is filing for bankruptcy.

• LM Arena raised $100M at a $600M valuation to expand its AI benchmarking platform used by top labs for model testing and marketing.

• Argentina-based investment group Grupo Werthein launched Illumia, a humanized generative AI service, with an initial investment of $40M, the company said on Wednesday.

Thought starters:

• AI Stage - Day 2 (Google I/O 2025)

• Orson Welles Can Now Be Your AI-Generated Tour Guide

• Brain-inspired AI model learns sensory data efficiently

Meme of the day:

Thanks for reading,

Eddie

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