OpenAI CEO declares "code red" as Gemini gains 200 million users in 3 months

OpenAI CEO Sam Altman reportedly issued a "code red" memo on Monday, redirecting company resources away from advertising features, shopping agents, and other initiatives to focus entirely on improving ChatGPT's core functionality. The catalyst? Google's Gemini has gained 200 million users in just three months, jumping from 450 million in July to 650 million in October 2024.

This marks a stunning turnaround from 2022, when Google declared its own "code red" after ChatGPT's viral launch caught the search giant flat-footed. Now OpenAI finds itself playing defense as Google's methodical approach to AI development pays massive dividends.

Gemini's growth trajectory reveals the power of distribution and integration. Google's AI assistant doesn't just exist as a standalone app - it's embedded across Google's ecosystem, from search results to Gmail to Android devices.

OpenAI maintains a larger weekly user base with over 800 million ChatGPT users, but Gemini's monthly active users are growing at an unprecedented pace. The surge was partly driven by tools like the "Nano Banana" image generator, demonstrating how creative features can accelerate adoption. More concerning for OpenAI, industry insiders report that Google's Gemini 3 model is outperforming ChatGPT on key benchmarks.

Google's success stems from patient infrastructure building rather than flashy product launches. While OpenAI captured cultural attention with ChatGPT, Google was quietly developing its Gemini models and integrating AI across its product stack. The company's new "Ironwood" chips provide cost advantages over Nvidia hardware, while its massive data centers enable rapid scaling.

The search giant's approach reflects lessons learned from mobile computing. Rather than chasing first-mover advantage, Google focused on creating an AI ecosystem that could leverage existing user behaviors and distribution channels. Gemini doesn't need to convince people to visit a new website—it appears where Google users already spend their time.

Altman promised a new reasoning model next week that he claims will outperform Gemini 3, suggesting OpenAI isn't conceding defeat. However, the company's financial pressures and resource constraints limit its ability to match Google's sustained investment. Microsoft's reported $3.1 billion loss on OpenAI in its recent quarter adds another layer of complexity to the partnership.