The report says that Amazon is working on a new smartphone that will have Alexa at its core

It looks like Amazon is getting back into the smartphone game. More than 11 years after the e-commerce giant discontinued its failed first attempt, the Fire Phone, the company is now developing a new smartphone codenamed “Transformer,” Reuters reported, citing anonymous sources.

The report said the device is being developed by the company’s Devices and Services division, and will contain customized features that make it easier to use Amazon’s suite of apps, including Amazon Shopping, Prime Video, and Prime Music.

The smartphone will also support Alexa, the smart home assistant that Amazon is investing heavily in, adding AI chips and expanding support to work with most of the company’s devices. AI features are said to be a big focus of the smartphone, which is seen internally as a way to encourage Amazon customers to use its AI products, Reuters reported.

The smartphone is said to be developed by a relatively new unit within the hardware division called ZeroOne, which is led by J Allard, the former Microsoft executive who helped create Xbox.

This news comes as Amazon is going all-in on AI, investing $50 billion in OpenAI recently, and expects to spend $200 billion in capital expenditures on AI, chips and robotics efforts in 2026.

The company spent more than a year revamping its Alexa assistant with generative AI features, finally launching it in February under the name Alexa+. The assistant keeps its smart home stuff, and can now do most of the things other AI-powered chatbots can do — like plan an itinerary, update a shared calendar, find and save recipes to the library, make movie recommendations, help with homework, explore a topic, and more.

Amazon declined to comment.