OpenAI plans to launch its first custom device soon. This new gadget is a smart speaker with a fun, human-like voice. Yet, this bold move comes during a massive drop in hardware sales. Also, the tech firm itself faces huge cash losses.
A New Gadget with Moving Parts
Recent facts came from a news report by Mark Gurman. He called the upcoming device a neat battery-powered speaker. Also, it features a smart camera, room sensors, and moving parts.
Early this spring, former top boss Fidji Simo warned the staff. She said the firm risked losing focus on its main goals. Costly side projects, like the Sora video tool closed in April, drew focus away. Clearly, this new smart speaker looks like another huge distraction.
Facing a Shrinking Market
The market for smart speakers has shrunk wildly for years. Based on data from the firm IDC, global sales dropped by a huge margin in 2023. A year later, they fell even further. The launch of Alexa+ in 2025 briefly slowed this sharp crash. Still, the overall market shrank again. By late 2026, analysts expect another bad drop. After that, sales numbers should finally settle down.
Jitesh Ubrani, a top research boss at IDC, explains this ongoing slump. He notes that users lack strong reasons to buy new devices. Most new software features arrive quietly via cloud updates. Meanwhile, people mostly use the gear for simple tasks like playing music and setting timers.
Pricing Hurdles and Competition
Entering this shrinking space will prove highly tough for OpenAI. Huge players already rule this stalled product class. Also, the final price presents a massive hurdle. In the past, cheap speakers under one hundred dollars sold best. On the other hand, a device with a camera and moving parts will cost much more. Ubrani thinks very few buyers will pay three hundred dollars for a speaker. Thus, any new brand must offer cheap choices.
Advanced Voice Tech Promises
OpenAI claims its gadget’s main trick is human-level chat. This relies on the new voice model built on a neat dual setup. Such a system hears speech and forms answers at the exact same time. Thus, it allows smooth chats, better timing, and fast live translations.
Amazon made very similar promises last year. They launched Alexa+ with mood reading and deep chat memory. However, Ubrani notes that this big update failed to stop the bad market trends.
The Profitability Problem
The core question of actual profit stays fully open. Amazon, the clear market leader, struggled for years to make cash from Alexa. They sold Echo speakers mostly at cost. Meanwhile, simple user commands brought almost zero daily cash. In early 2022, Amazon’s hardware group took a massive cash loss. The voice helper caused the vast bulk of this huge debt.
Still, entering the hardware world follows a clear logic. Smart AI cannot live solely inside a web browser. It needs to “know” the real physical world. Therefore, it needs custom native hardware. A speaker is much cheaper to build than a complex phone or smart glasses.
Financial Realities and Future Outlook
Meanwhile, OpenAI itself stays deeply broke. Leaked cash reports show scary numbers. The firm lost vast billions in 2024. Next, losses hit wild new highs in 2025. Also, leaders do not expect any real profit until 2030. As detailed in a recent piece on how smart speakers could help OpenAI lose even more money, a speaker will hardly fix this bleak path. Thus, tech experts view this risky bet with clear doubt.
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