According to TechSpot, an internal memo from OpenAI CEO Sam Altman declares a “code red” emergency, the company’s highest urgency level, to improve ChatGPT’s quality. The directive delays work on other initiatives like advertising, AI agents for health, and a personal assistant product called Pulse. Altman cited three key areas for improvement: personalization, speed and reliability, and the range of answerable questions. This push comes as OpenAI prepares to release a new reasoning model next week, which it claims beats Google’s latest Gemini on benchmarks. The move is a direct response to competitive pressure, with Google’s Gemini growing to 650 million monthly active users by October and Anthropic gaining enterprise traction. OpenAI, which is not yet profitable, projects a need for $200 billion in revenue by 2030, making ChatGPT’s 800 million weekly users critical to its survival.
The profitability clock is ticking
Here’s the thing that really jumps out: OpenAI is still not profitable. That’s a massive problem when you’re committing to “hundreds of billions” in future data center investments. Their own math says they need to hit roughly $200 billion in revenue by 2030. Let that sink in. That’s an almost unimaginable growth curve from where they are now. So this “code red” isn’t just about making a snappier chatbot. It’s a frantic scramble to protect and supercharge their one proven revenue engine before the money runs out. They’re betting the company on ChatGPT‘s ability to monetize its 800-million-user base, and right now, that engine is sputtering compared to the competition.
Google is the immediate threat
Altman’s memo makes it clear who’s keeping him up at night: Google. Look, Google has the distribution (think Search, Android, Gmail), the infrastructure, and the cash flow from a profitable core business. They can afford to play the long game. When Gemini hits 650 million monthly users and starts beating you on benchmarks, that’s an existential warning siren. OpenAI’s lead in cutting-edge research doesn’t matter if the everyday product experience feels slower, less reliable, or dumber than what people can get from a rival. The “code red” is an admission that they’ve been out-executed on the product front. They’re pausing everything else—ads, health agents, that Pulse assistant—just to catch up. That’s not the move of a confident leader; it’s the move of someone playing defense.
What “code red” actually means
So what does a “code red” look like in practice? Basically, it’s all-hands-on-deck. Daily stand-up calls for the ChatGPT team, temporary transfers from other projects, and a laser focus on three specific pain points. Personalization, speed, and query handling. That last one is telling. Users have complained about GPT-4o being “colder” and struggling with simple math or geography. That’s a bad look when you’re trying to be everyone’s AI companion. The goal is to make it feel more intuitive, like it *knows* you. But there’s a tension here they have to navigate: making it more engaging and useful while also balancing those ever-present safety concerns. Can they make it smarter and faster without making it more prone to going off the rails? That’s the billion-dollar question. Or, more accurately, the $200-billion-dollar question.
innovation-to-maintenance”>A shift from innovation to maintenance
This whole situation signals a fascinating shift for OpenAI. For years, they were the pure innovation lab, racing ahead with the next big model. Now, they’re being forced into a phase of intense product maintenance and optimization. It’s less about the next shiny thing (GPT-5?) and more about fixing the core product they already have. That’s a different skillset. And it puts them at a huge structural disadvantage against the Googles of the world, who have decades of experience running and refining global-scale consumer products. OpenAI’s survival now hinges not just on brilliant research, but on brilliant product management, operational reliability, and user retention—areas where the giants have a built-in advantage. The AI race is far from over, but the terrain has fundamentally changed.
