Last week, at the offices of the world's most valuable startup, something unusual happened.

It began with a notification that flashed across screens in the middle of the workday.

It's a typical Monday at OpenAI and the company's employees get hit with this slack message from Sam Altman, the CEO, where he declares a code red.

Code red.

CEO shorthand for, we're in trouble.

Kind of like a company-wide emergency telling employees that they had been seeing this big problem, kind of creep up, and then kind of explode in recent weeks.

That's our colleague Berber Jin. He covers artificial intelligence.

In many senses, it was a memo that you wouldn't expect from Sam Malman, because Sam

Malman, his leadership style is to dream big and to spin up products at a really rapid pace

and ship them really fast and kind of look to the stars.

And this memo was the opposite.

It was like, we need to become more disciplined

and we need to focus on making the basic features

of chat dbt better for users.

What prompted this urgent message?

This is the first time in the company's history

that it's faced such a big threat from one competitor, that competitor being Google.

Usage of their AI app called Gemini just skyrocketed.

I mean, they kind of dealt this blow to open AI in a way that they hadn't really before.

Was this a surprise to you?

This is definitely a surprise to me because for the three years that I've been covering this

company, their lead with Chatchipiti has almost been a given.

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