OpenAI is reportedly shifting into crisis mode as the competition in the AI industry is growing. CEO Sam Altman has reportedly told employees that the company is entering a code red period with an agenda of refocusing the efforts to strengthen ChatGPT amid the rising pressure from rivals such as Google and Anthropic, according to reports from The Wall Street Journal and The Information.
As per the report citing the internal memo, Altman stated that several upcoming projects, including the advertising tools, health and shopping-focused agents, and personal assistant known as pulse, will be paused so teams can prioritise improving ChatGPT’s speed, reliability, accuracy and personalisation. The report further added that the company will also hold daily check-ins for teams working on upgrades and staff are being encouraged to temporarily join these development groups to accelerate progress.
This move comes at a critical time for OpenAI, which is looking for a sustainable business model and facing increasingly aggressive competition. Google, which initially activated its own ‘code red’ in response to ChatGPT’s launch, has quickly gained traction with a growing user base and new AI breakthroughs. Its most recent model, Gemini 3, has outperformed competitors on multiple benchmarks, further giving Google a good position in the AI race.
Last month, The Information reported that CEO Sam Altman in his memo, warned employees of Google’s latest advances, including the Gemini 3.0 model across Search, Android, and Workspace and also warned about the challenging months ahead. He also acknowledged increased competition from Anthropic, whose Claude assistant is gaining popularity among developers, particularly for coding tasks.
He also warned that OpenAI may face short-term financial and market pressures as the AI sector becomes more crowded, despite the fact that the company is still on track to meet its $13 billion revenue target by 2025. However, he stated that despite the challenges, OpenAI has strong fundamentals and is confident in its long-term position in the global AI race.