Is Google’s Gemini 3 becoming unstoppable? Inside the ‘code red’ panic shaking OpenAI

Google has flipped the script in the global AI race. Three years after ChatGPT’s historic launch pushed Google into crisis mode, the tech landscape has reversed sharply: OpenAI CEO Sam Altman has declared an internal “code red” as Google’s Gemini 3 accelerates ahead in model performance, user engagement, and ecosystem dominance.

According to internal memos reported by The Wall Street Journal and The Information, OpenAI has halted multiple commercial initiatives advertising, AI shopping tools, and its Pulse personal assistant, to focus fully on improving ChatGPT’s speed, reliability, and personalization. The memo signals the company’s highest level of internal alarm, mirroring the emergency state Google declared in 2022.

Google’s AI Momentum Forces OpenAI to Hit the Panic Button

Google’s comeback is fueled by what executives call its “full-stack advantage”, a vertically integrated AI ecosystem combining DeepMind research, Google Cloud infrastructure, and custom TPU chips that dramatically reduce model training costs.

Gemini’s user base has grown from 450 million monthly active users in July to 650 million in October, with Similarweb reporting users now spend more time on Gemini than ChatGPT.

In contrast, OpenAI relies on expensive Nvidia GPUs and Microsoft’s cloud infrastructure, both costly dependencies at a time when the company faces enormous financial pressure.

Altman acknowledged the stakes in his memo, writing: “We are at a critical time for ChatGPT.” He ordered all teams to suspend revenue-focused projects and focus solely on restoring ChatGPT’s competitive edge.

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Gemini 3 Emerges as Google’s Most Formidable Model Yet

Early benchmarks show Gemini 3 outperforming OpenAI’s GPT-5 and challenging Anthropic’s Opus 4.5 in key reasoning, speed, and creativity tests. Gemini’s new Nano Banana Pro image generator has also gone viral, drawing praise from industry executives including Salesforce CEO Marc Benioff, who called the model’s leap “insane.”

The significance of Gemini 3 extends beyond software. Reports suggest that Meta is considering bulk purchases of Google’s TPU chips, a shift that sent Nvidia’s stock plunging over 6%, wiping out $250 billion in value. If major AI companies pivot from Nvidia’s GPUs to Google’s silicon, the hardware market may undergo a historic realignment.

OpenAI’s Financial Reality Intensifies Urgency

The Wall Street Journal estimates OpenAI needs to hit $200 billion in annual revenue by 2030 to become profitable, roughly 100× growth in five years. Meanwhile, Google already generates $120 billion annually, backed by nearly $100 billion in cash reserves.

This allows Google to ship advanced models at low or zero cost, while OpenAI must prioritize revenue, complicating its ability to compete.

Despite declaring his confidence, Altman’s memo reveals significant internal strain. While he promised a new reasoning model that will exceed Gemini 3, his “code red” directive underscores fears that OpenAI may be losing the momentum that once made it the defining force in modern AI.

What This Means for the Global AI Race

Google’s resurgence marks a decisive shift. Its ability to control chips, cloud, models, and distribution, across Search, YouTube, Gmail, and 3 billion Android devices, creates an advantage no rival can easily replicate.

The next 12 months will determine whether Google solidifies its dominance or whether OpenAI’s upcoming models can regain the initiative. For now, though, Google stands on the offensive, and OpenAI is playing catch-up.

FAQ

1. Why did Sam Altman declare a “code red” at OpenAI?

Altman issued the highest internal alert after reports showed Google’s Gemini 3 surpassing ChatGPT in performance benchmarks, user engagement, and adoption. The memo instructed employees to halt revenue projects and focus on improving ChatGPT’s speed, reliability, and personalization.

2. Is Google’s Gemini 3 actually better than ChatGPT?

Benchmarks cited by industry testers show Gemini 3 outperforming GPT-5 in reasoning, creativity, and task execution. Its new image generator, Nano Banana Pro, has also generated strong positive reviews. However, OpenAI claims its upcoming model may overtake Gemini.

3. How many users does Google Gemini have?

Gemini has grown rapidly to 650 million monthly active users, a sharp increase from 450 million a few months earlier, making it one of the fastest-growing AI platforms globally.

4. What happened to OpenAI’s advertising plans?

OpenAI paused plans to integrate ads and AI shopping features into ChatGPT due to the “code red” shift. These projects, including Pulse and shopping assistants, are now on hold while teams focus exclusively on core ChatGPT improvements.

5. How does Google’s TPU chip give it an advantage?

Google’s proprietary Tensor Processing Units (TPUs) allow it to train and scale models at far lower cost than competitors using Nvidia GPUs. This full-stack integration, from chips to cloud to apps, gives Google a structural economic advantage.

6. Why did Nvidia’s stock fall after Gemini 3’s launch?

Reports that Meta and other major AI firms may buy Google’s TPU chips instead of Nvidia GPUs triggered a market reaction. A potential shift away from Nvidia threatens a significant portion of the company’s future revenue.

7. What financial pressure is OpenAI facing?

OpenAI must generate roughly $200 billion in yearly revenue by 2030 to achieve profitability, according to The Wall Street Journal. This comes as compute costs skyrocket and competition intensifies.

8. Can OpenAI still compete with Google?

Yes, OpenAI is preparing a new reasoning model and remains a leading innovator. However, Google’s integrated infrastructure and massive distribution network create challenges OpenAI cannot easily match.

9. What makes Gemini 3 different from earlier models?

Gemini 3 boasts stronger reasoning skills, faster performance, better multimodal capabilities, and enhanced creativity. Its Nano Banana Pro image generator sets a new bar for AI-driven visuals.

10. Is this the beginning of Google dominating the AI market?

Analysts believe Google now has the momentum thanks to its full-stack ecosystem and cost-efficient model deployment. But the AI race remains fluid, with future breakthroughs from OpenAI, Anthropic, or Meta capable of reshaping the field.