Over the past year, OpenAI has expanded well beyond chatbots, operating more like a broad technology company with multiple business lines.
A Wall Street Journal report says CEO Sam Altman briefly considered spinning off the company’s robotics and consumer hardware divisions in an Alphabet-style structure.
The idea is to give those businesses their own capital-raising paths and a clearer operating structure.
The catch seems simple, as once lawyers and finance teams dug in, the plan no longer solved the problem it was meant to fix, because the units would still have to be folded into OpenAI’s results.
That left the company with the complexity of a breakup and none of the bookkeeping benefit.
Spinoff plan hits limits
The attraction of a spinoff is easy to understand as fast-growing units can raise money more easily, investors can judge them on their own merits, and the parent company can present a cleaner story.
That is especially useful when one division is still software-heavy and another is capital-intensive hardware.
But the WSJ report said that OpenAI concluded a carve-out would not really change its financial reporting, which meant the strategic point of the exercise disappeared.
In simple words, OpenAI tried changing the structure of a holding company, then ran into the reality that the business still behaves like one integrated operation.
Hardware empire taking shape
The reason the idea surfaced at all is that OpenAI has been building far beyond pure software.
In May 2025, the company bought Jony Ive’s startup io Products in a $6.5 billion all-stock deal and brought Ive in as creative head.
OpenAI wanted to develop devices tailored for the generative AI era.
OpenAI and Ive have said the prototype work is under way, while the company’s July update said the io team had officially merged into OpenAI.
That hardware push does not stop there as OpenAI announced a collaboration with Broadcom in October 2025 to develop 10 gigawatts of custom AI accelerators.
It has also been active in robotics.
Figure, the humanoid robot startup, has partnered with OpenAI on specialized AI models, and OpenAI has been an investor in the company’s financing rounds.
Separately, 1X Technologies said its Series A2 round was led by OpenAI.
Put together, those moves help explain why the company once considered separating the units: the hardware bets are becoming too large to look like side projects.
OpenAI IPO under pressure
All of this is happening while OpenAI is preparing for a potential public debut that could come as soon as the second half of 2026.
The early discussions are weighing a possible $1 trillion valuation and a fundraising target that could start at $60 billion or more.
But the road there looks messy as OpenAI missed multiple monthly revenue targets earlier this year after losing ground to Anthropic in coding and enterprise markets.
CFO Sarah Friar has raised concerns internally about whether the company could meet future computing commitments if revenue does not grow fast enough.
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