Qualcomm shares surged about 13% in premarket trading on Monday following a social media post from analyst Ming-Chi Kuo stating that OpenAI is working with Qualcomm and Taiwan-based MediaTek to develop processors tailored for an AI-first smartphone.
Kuo, who is based in Taiwan and is frequently cited for accurate predictions about Apple products, wrote that Qualcomm and MediaTek are co-development partners on a device the ChatGPT creator is planning. He added that China’s Luxshare, an Apple supplier, would serve as the exclusive system design and manufacturing partner for the handset, and that mass production is likely to occur in 2028.
Requests for comment sent to the companies named in Kuo’s post did not receive immediate responses.
OpenAI has been reported to have explored consumer hardware options for several years. Last May, it acquired the design firm founded by Jony Ive, io Products, for $6.5 billion and tapped the former Apple designer to lead the company’s product efforts.
Despite that acquisition, other media reports have suggested that OpenAI’s planned consumer device would not be a smartphone. The Wall Street Journal reported last year that CEO Sam Altman described the project internally as a "third core device" intended to sit alongside phones and laptops.
The company, which has operated at a loss, has reportedly narrowed its focus to coding tools for businesses in recent months, an area analysts view as having clearer commercial traction within the AI market.
Entering the smartphone business would place OpenAI in direct competition with established manufacturers, notably Apple and Samsung, which together account for roughly 40% of global smartphone shipments. The move would also reinforce indications that smartphones are expected to remain central to consumers’ daily lives in the coming AI era, a notion underscored by reporting that Amazon is planning renewed efforts in the handset market.
In market reaction outside Qualcomm, Apple shares were reported down 1.7% on the day. Apple's recent executive change, naming long-time hardware leader John Ternus as CEO, was noted by observers as a sign that devices will remain pivotal to the company even as it seeks to expand AI capabilities for users.
Summary
An analyst post by Ming-Chi Kuo said OpenAI is collaborating with Qualcomm and MediaTek to create processors for an AI-first smartphone, with Luxshare as the exclusive systems partner and mass production likely in 2028. Qualcomm shares rose sharply in premarket trading following the report. The companies named did not immediately comment.
Key points
- Qualcomm shares jumped about 13% in premarket trading after the analyst report.
- Ming-Chi Kuo reported Qualcomm and MediaTek are co-development partners for an OpenAI-planned AI-first smartphone; Luxshare is cited as the exclusive system design and manufacturing partner and mass production is likely in 2028.
- The development, if realized, would pit OpenAI against major smartphone makers like Apple and Samsung and signals continued centrality of the smartphone in an AI-driven ecosystem.
Risks and uncertainties
- None of the companies named in Kuo's post had provided immediate comment, leaving the timeline and scope of the project unconfirmed by the firms involved - this affects the semiconductor and device manufacturing sectors.
- Previous reports have suggested OpenAI’s consumer device plans might not be a smartphone, creating uncertainty about whether the project described will proceed as reported - this impacts handset makers and suppliers.
- OpenAI’s recent strategic shifts toward business-facing coding tools and the company’s loss-making status present execution and financial risks for any large-scale hardware initiative - relevant to venture funding and hardware supply chains.
The market reaction illustrates investor appetite for potential new revenue opportunities in mobile AI processing, while also highlighting the many open questions that remain about the device’s form, timeline and broader market implications.