OpenAI CEO Sam Altman revealed on the 5th that the company considered spinning off its robotics and consumer hardware divisions into separate entities by the end of 2025. This plan aimed to provide these divisions with greater growth potential and reduce the burden on its core business. According to sources familiar with the matter, the proposal was ultimately rejected, partly because OpenAI believed the new entities might still need to be consolidated on its balance sheet.
This discussion began in late 2025, with OpenAI’s leadership hoping to simplify the company structure and be more competitive in its upcoming IPO by separating hardware-related projects from its core AI business. These hardware divisions are considered high-risk because they require significant R&D investment and supply chain dependence, contrasting sharply with OpenAI’s scalable software models, such as the GPT series.
In the robotics field, OpenAI invested $675 million in Figure AI in 2024, focusing on humanoid robots for manufacturing. If spun off, it is expected to form a separate entity valued at approximately $2 billion, which would reduce the risk of OpenAI’s slow commercialization timeline. On the hardware side, OpenAI’s efforts include collaborations with Broadcom and TSMC to develop its own AI chips to compete with Nvidia. The spin-off could result in a company called “OpenHardware Inc.”, with funding requirements between $5 billion and $10 billion, similar to the initiatives of Anthropic and xAI.
These discussions are accelerating as the ChatGPT corporate deal progresses, with the robotics and hardware division consuming 20% to 30% of OpenAI’s $7 billion burn rate in 2025. While no final decision has been made, a board memo indicates that the plan could be announced in the first quarter of 2026 if the IPO S-1 filing proceeds smoothly. This move aligns with industry trends: Google spun off DeepMind’s hardware division in 2024, and Meta is considering a similar move for Reality Labs.
For OpenAI, this strategy could make its IPO narrative clearer and, by emphasizing a software profit margin of over 70%, could boost its stock price by 15% to 20%. For investors, this would provide investment opportunities in the pure robotics sector, especially given the rising demand for AI chips under the US CHIPS Act subsidies. In the market, this move could accelerate the AI hardware race, with the spun-off company potentially partnering with Tesla’s Optimus or Boston Dynamics.
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