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In one of the biggest acquisitions in the iPhone maker’s history, Apple has acquired Q.AI, a secretive Israeli startup with technology that can analyze facial expressions and understand “silent speech.”
The deal is designed to help the iPhone maker close the gap with Meta, Google and OpenAI in the growing race to develop a new class of wearable devices that talk to AI.
The deal values 4-year-old Q.AI at nearly $2 billion, according to people familiar with the terms.
GV (formerly Google Ventures), one of Q.AI’s financial backers, said in a blog post that the deal is Apple’s “second largest acquisition in history.”
A patent filed by Q.AI shows that the technology is used in headphones and glasses, and uses “micro movements of facial skin” to communicate without speaking.
Such a system could allow Apple customers wearing headphones and smart glasses to have private, nonverbal conversations with an AI assistant.
Johnny Slogi, Apple’s senior vice president of hardware technology, said Q.AI is “a remarkable company that is pioneering new and creative ways to use imaging and machine learning.”
Silicon Valley companies are also rushing to develop competing AI-powered “wearable” devices.
Meta has seen success with its Ray-Ban-branded smart glasses that allow wearers to talk to the company’s AI, and Google and Snap are preparing to launch smart glasses later this year.
OpenAI acquired former Apple designer Jony Ive’s startup IO last year. The company is said to be developing a compact device to interact with ChatGPT.
Investors are worried that Apple will be left behind in the AI race after delaying the launch of an upgraded version of its voice assistant, Siri, which is widely considered to be far behind Google Gemini and OpenAI’s ChatGPT.
The company recently signed a deal with Google to use the search group’s Gemini system to power its AI services, branded Apple Intelligence.
Apple rarely makes large-scale acquisitions, preferring instead to quietly “acquire” talent and secure intellectual property from smaller startups that often fly under the radar.
Its biggest deal to date was the $3 billion acquisition of Beats in 2014, which allowed the tech giant to catch up with Spotify in its foray into music streaming with Apple Music.
Some of its biggest acquisitions have been in semiconductors, as the company has been bringing chip design in-house for years. These include the $1 billion acquisition of Intel’s smartphone modem business in 2019, the $600 million acquisition of Dialog Semiconductor in 2018, and the $500 million acquisition of Israeli flash memory company Anovit in 2011.
Other recent deals reflect the iPhone maker’s focus on computer vision and artificial intelligence, following the launch of the Vision Pro headset and its suite of AI features, Apple Intelligence. These include last year’s acquisitions of Israeli 3D avatar startup TrueMeeting and generative AI company Pointable.
Q.AI was founded in Tel Aviv in 2022 by Aviad Maisels, Yonatan Wexler, and Avi Barlya. It has operated in near secrecy ever since, with Wexler hinting in a social media post shortly after its launch: “I can’t say anything about our products yet, but I’m sure you’ll be speechless.”
Its financial backers also include Kleiner Perkins, Spark Capital, and Exor.
Some of Q.AI’s team previously worked at PrimeSense, another Israeli startup that Apple acquired in 2013. PrimeSense’s 3D sensing technology formed a key part of the iPhone’s FaceID login system.
