The future of AI depends on physical world innovation: robots, drones, and manufacturing are becoming as critical as software, but hardware faces supply chain crises, geopolitical risks, and the challenge of building at scale. Former OpenAI, Meta, and Apple hardware leader Caitlin Kalinowski explains why actuators and magnets matter more than humanoids, why memory prices are about to shock the industry, and how the technologies built for VR are now powering warfare. Hardware teams compile products only 4-5 times per year versus software's daily iterations, forcing conservative design and 6-12 month development cycles instead of rapid agile pivots.