OpenAI is working with Qualcomm and MediaTek to develop custom processors for an AI-first smartphone, according to supply chain analyst Ming-Chi Kuo.

Kuo said the phone will run on AI agents instead of traditional apps. Users will tell the device what they need, and agents will handle tasks across services using both on-device and cloud AI. The smartphone, he argued, is the only device that captures a user’s full real-time state.

Luxshare Precision Industry is said to be the exclusive manufacturing partner. Specs and suppliers are expected to be finalised by late 2026 or early 2027, with mass production targeted for 2028.

Kuo has previously projected annual shipments of 300 to 400 million units if the device succeeds, a figure that would challenge iPhone sales.

OpenAI has not confirmed the plans. The company acquired Jony Ive’s io Products last year for $6.5 billion to lead its hardware efforts.

Industry watchers caution that OpenAI has not confirmed any phone, and earlier reports also mentioned a screenless device as an option.