The ChatGPT maker “appears to be fast-tracking” its first AI agent phone, with mass production targeted as early as next year, according to an industry analyst.

If the development plan stays on track, OpenAI may be eyeing combined shipments of its new phone reaching around 30 million units in 2027 and 2028, TF International Securities analyst Ming-Chi Kuo said in a post on social media platform X.

In his earlier posts, Kuo claimed that the mass production of OpenAI phones was likely in 2028, but it appears that the company is now “fast-tracking” the process due to market pressure.

“Potential drivers include supporting a year-end IPO narrative and intensifying competition in AI agent phones,” the analyst said.

Last week, he said that OpenAI was working with US chip designer Qualcomm and Taiwan’s MediaTek to develop smartphone processors, with China’s Luxshare, an Apple supplier, as the exclusive system design and manufacturing partner for the device.

Kuo, who is based in Taiwan, is known for his accurate predictions on Apple’s products. Qualcomm shares jumped 13% following his initial social media posts.

In his latest posts, he said that “MediaTek currently appears better positioned to become the sole processor supplier,” and that the new device is “set to use a customized version of the Dimensity 9600, built on TSMC’s N2P node.”

“Other key specs include a dual-NPU architecture for heterogeneous AI compute, LPDDR6 + UFS 5.0 to ease memory bottlenecks, and pKVM + inline hashing for security,” Kuo said.

Cybernews has reached out to OpenAI for comment.

Saturated smartphone market

Last May, OpenAI paid $6.5 billion to acquire io Product, a startup founded by Jony Ive, who helped design some of Apple’s most iconic products.

It was reported shortly after that OpenAI was already in early stages of developing its hardware AI device, with Ive describing the prototype as having “completely captured” his imagination.

OpenAI CEO Sam Altman said that the company envisioned the new gadget as a “third device” for consumers to use alongside their smartphones and laptops, as reported by The Wall Street Journal at the time.

However, latest reports suggest that AI may not usher an end to a smartphone era just yet, with OpenAI joining an already saturated market dominated by Apple and Samsung, both of which continue to focus on handset devices.

Meanwhile, Amazon is reportedly planning a return to the smartphone market, with a device codenamed “Transformer” in development.

Why would OpenAI make a phone?

Smartphones will remain the largest-scale device category in the foreseeable future, which is one of the reasons behind OpenAI’s push into the market, according to Kuo.

Even in a saturated market, the company has advantages over its more established competitors, especially as AI agents are on the course to replace apps in device interface design.

“OpenAI’s advantages lie in its consumer brand, years of accumulated user data, and leading AI models,” Kuo said in an article posted on X in April.

“Smartphone hardware is already highly mature, so OpenAI can work with the supply chain to develop the device. On the business model side, OpenAI may bundle subscriptions with hardware and build a new AI agent ecosystem with developers,” he said.

According to Kuo, OpenAI can deliver a comprehensive AI agent service only by fully controlling both the operating system and hardware, with things like power consumption, memory hierarchy management, and basic small-model execution key processor design considerations.

“The smartphone is the only device that captures the user’s full real-time state, which is the most important input for real-time AI agent inference,” he said.

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