OpenAI Hits the Panic Button as Sam Altman Declares ‘Code Red’

Just a day after its wildly popular chatbot, ChatGPT, turned three, OpenAI is hitting the panic button.

OpenAI CEO Sam Altman has declared a company-wide “code red,” pulling teams into an all-hands push to boost ChatGPT’s performance, amid fast-rising competition. 

According to an internal memo seen by The Wall Street Journal, Altman told employees the company needed to improve the “day-to-day experience” of its chatbot. That includes personalization, faster responses, better reliability, and the ability to “answer a wider range of questions.”

The move marks the strongest sign yet that the pressure from rivals is starting to bite. This new crisis-mode environment follows a previous “code orange” effort the company initiated in October, according to reports.

Google and Anthropic’s surge raises pressure

The primary driver for the heightened alert is the aggressive progress of rivals, particularly Google’s Gemini model. Google’s latest version of Gemini recently outperformed OpenAI’s models across various industry benchmarks.

The competition is gaining ground in user adoption as well. Since releasing the Nano Banana image generator in August, Google’s Gemini has seen its monthly active user base surge from 450 million in July to a reported 650 million in October. 

The new model has even prompted high praise from tech leaders, with Salesforce CEO Marc Benioff posting on X, “I’ve used ChatGPT every day for 3 years. Just spent 2 hours on Gemini 3. I’m not going back. The leap is insane.” Even Altman congratulated Google on X, calling Gemini 3 a “great model.” 

OpenAI is also facing pressure from Anthropic, whose Claude assistant is reportedly gaining popularity, especially among business clients and developers focused on coding tasks.

Projects paused as OpenAI refocuses

To dedicate the company’s full attention to the code red effort, several upcoming initiatives are being delayed, according to reports citing the memo. This means that projects intended to boost revenue and expand functionality are temporarily being put on hold.

Among the delayed products are the integration of advertising into ChatGPT, which has been in testing; specialized AI agents built for health and shopping queries; and the personal assistant tool known as Pulse.

While the company is financially disadvantaged compared to competitors like Google, which can fund AI development from its substantial revenues, OpenAI is betting on the loyalty of its massive user base, which reportedly includes over 800 million weekly users. 

In a public statement on X, Nick Turley, the head of ChatGPT, acknowledged the rapidly evolving market while reinforcing the company’s position: “Our focus now is to keep making ChatGPT more capable, continue growing, and expand access around the world — while making it feel even more intuitive and personal.” Turley also claimed that ChatGPT is currently the “#1 AI assistant worldwide,” accounting for approximately 10% of overall search activity.

A high-stakes moment for OpenAI

The stakes are high as the company has committed to hundreds of billions of dollars in future data center investments, and concerns around those long-term costs have already created tension among investors. While the company remains private, its success is closely tied to its ability to retain its leadership position against financially dominant rivals like Google.

Even so, the company believes it still has momentum. According to the Journal, Altman told employees that a new reasoning model expected next week is already outperforming Google’s latest Gemini in internal tests.

Meanwhile, coverage of ChatGPT’s dangerous mental health advice shows how safety failures can still surface when users seek support.