OpenAI in “code red” after losing 6% of its users in a week due to Gemini 3, report says
In a significant move within the AI landscape, Google has unveiled its latest AI model, Gemini 3, which it claims to be the “most intelligent” iteration yet. This announcement has sent shockwaves through the industry, particularly at OpenAI, where CEO Sam Altman has reportedly issued a “code red” memo in response to the mounting competition. According to a leak reported by The Wall Street Journal, Altman’s communication emphasizes the urgent need for OpenAI to address the challenges posed by Gemini 3 and other competitors like Anthropic’s Claude. These developments highlight the rapidly evolving nature of AI technology, where performance metrics and user engagement are becoming increasingly critical.
The impact of Gemini 3’s launch is already evident, with reports indicating that OpenAI has experienced a decline in user traffic, losing nearly 6% of its daily visits since the new model’s debut. Former Google employee Deedy Das shared insights from SimilarWeb, suggesting that ChatGPT’s average daily traffic plummeted from 203 million to 191 million, translating to a loss of approximately 12 million users. While some of this drop may be attributed to seasonal factors like Thanksgiving, the data underscores a significant shift in user preferences. This decline follows a series of missteps for OpenAI, including the controversial release of GPT-5, which received backlash for its less personable tone compared to its predecessors. Despite its advanced capabilities, GPT-5’s perceived lack of user-friendliness has alienated some of OpenAI’s core audience, prompting the company to revert to its earlier model, GPT-4o.
As the competitive landscape intensifies, Google’s Gemini 3 has garnered widespread acclaim, topping various benchmark leaderboards thanks to its robust training data access, a clear advantage stemming from Google’s extensive resources. Meanwhile, Anthropic is making strides in the enterprise sector, boasting over 300,000 business customers, including Fortune 500 companies, which adds further pressure on OpenAI. In light of these developments, OpenAI is not sitting idly; the company is actively pursuing strategic partnerships and infrastructure deals with major players like Nvidia and Oracle. Altman has also addressed concerns about the sustainability of the AI boom, suggesting that OpenAI is aware of the precariousness of its position in this rapidly shifting market. As the battle for AI supremacy heats up, the coming months will be crucial for OpenAI as it seeks to reclaim its footing amid fierce competition.
Recently, Google
introduced Gemini 3
, which the company called its “most intelligent” AI model yet. So far, the AI leaderboards agree, with Gemini 3 surging ahead of rivals like ChatGPT at
LMArena
. Now, OpenAI head honcho Sam Altman has reportedly declared “code red” at the company in response to increased pressure from competitors.
The announcement came in the form of a memo that
was leaked to
The
Wall Street Journal
. The contents of the memo are largely unknown, but the message was direct — OpenAI has some serious competition in the likes of Gemini 3 and Anthropic’s Claude, and the company needs to do something about it.
SEE ALSO:
Google Gemini 3 vs ChatGPT: How they compare
According to
a post on X
from former Googler Deedy Das, OpenAI has lost nearly 6 percent of its traffic since Gemini 3 launched. The data is sourced from SimilarWeb, which says that ChatGPT went from 203 million average daily visits to 191 million. If that data is accurate, it means OpenAI lost about 12 million people per day over the last week. Some of that may be due to Thanksgiving, but it’s a big shift.
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The problems started months ago with some slips from the reigning champion of AI chatbots. When GPT-5 was released earlier this year, it was immediately
criticized for its less friendly tone
compared to earlier models. Criticism was so intense that
OpenAI ultimately decided to bring back GPT-4o
. The data shows that GPT-5 is more capable than its predecessors, but its lack of personality irked hardcore users who used the bot every day. Plus, OpenAI has been walking a tightrope to balance functionality and safety, which it has
not done particularly well
.
Despite the criticisms, it seemed OpenAI was destined to keep its top spot among the AI chatbot competitors. However, Google released Gemini 3 in late November
to nearly universal praise
, with Google’s offerings topping nearly all of the benchmark leaderboards. Due to the sheer size and reach of Google, the company has a significant advantage in accessing training data, the lifeblood of AI models.
The competition is also ramping up on the enterprise side of things. Anthropic
boasts more than 300,000 business customers
as of September 2025, which includes some Fortune 500 companies.
These are all likely reasons why OpenAI is in code red; losing that many visitors is certainly noticeable. Of course, OpenAI is hardly staying still. The company is working on tons of initiatives, including
inking infrastructure deals
with the likes of Nvidia, Oracle, and other companies.
In November, Sam Altman wrote a
long post on X
addressing fears of an AI bubble and concerns that OpenAI is overextending itself.
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Disclosure: Ziff Davis, Mashable’s parent company, in April filed a lawsuit against OpenAI, alleging it infringed Ziff Davis copyrights in training and operating its AI systems.
Eric
Eric is a seasoned journalist covering US Tech & AI news.
