Sam Altman Declares ‘Code Red’ for OpenAI Amidst ChatGPT’s Growing Competition

Sam Altman has issued a “code red” for OpenAI to enhance ChatGPT amid strong competition from other chatbots.

In a recent report from the technology news site Information, the CEO of the San Francisco-based startup informed staff in an internal memo: “We are at a critical time for ChatGPT.”

OpenAI is feeling the pressure from the success of Gemini 3, Google’s latest AI model, and is allocating additional resources to improve ChatGPT.

Last month, Altman informed employees that the launch of Gemini 3 had outperformed competitors. According to various benchmarks, this could result in “temporary economic headwinds” for companies. He added, “I expect the global atmosphere to remain stormy for some time.”

While OpenAI’s flagship product boasts 800 million weekly users, Google benefits from a profitable search business along with vast data and financial resources for its AI initiatives.

Marc Benioff, CEO of the $220bn (£166bn) software company Salesforce, stated last month that he plans to switch to Gemini 3 and “never look back” after testing Google’s newest AI release.

“I’ve been using ChatGPT every day for three years. I just spent two hours on Gemini 3. I’m not going back. The leap is insane. Reasoning, speed, images, video… everything is clearer and faster. I feel like the world has changed again,” he remarked on X.

OpenAI is also scaling back its advertising efforts on ChatGPT as it prioritizes improvements to the chatbot, which recently celebrated its third anniversary.

Nick Turley, the head of ChatGPT, marked the anniversary with a post on X, committing to further innovations for the product.

“Our focus now is to further enhance ChatGPT’s capabilities, making it more intuitive and personal while continuing to grow and expand access worldwide. Thank you for an incredible three years. We have much work ahead!”

Despite not having the same cash flow support as rivals like Google, Meta, and Amazon, who fund competitor Anthropic, OpenAI has garnered substantial investments from firms like SoftBank Investment Group and Microsoft. At its latest valuation, OpenAI reached $500 billion, a significant increase from $157 billion last October.

OpenAI is currently operating at a loss but anticipates annual revenue to surpass $20 billion by year’s end, with Altman projecting that it will “grow to hundreds of billions.” The startup plans to allocate $1.4 trillion in data center costs over the next eight years to develop and maintain AI systems, aiming for rapid revenue growth.

“Considering the trends in AI usage and demand, we believe the risk of insufficient computing power at OpenAI is more significant and likely than the risk of excess computing power,” Altman stated last month.

Apple has also reacted to rising competitive pressure in the sector by appointing a new vice president of AI. John Gianandrea will be succeeded by Microsoft executive Amar Subramanya.

The company has been slow to integrate AI features into its products, while competitors like Samsung have been quicker to upgrade their devices with AI capabilities.

Subramanya comes to Apple from Microsoft, where he last served as vice president of AI. He previously spent 16 years at Google, including as head of engineering for the Gemini assistant.

Earlier this year, Apple announced that enhancements to its voice assistant Siri would be postponed until 2026.