In a memo to staff on Monday, Altman told employees that the company was "at a critical time for ChatGPT," and that resources must be devoted to fending off the new competition to its chatbot, the reports said.

Altman said that other projects would now be delayed, including a plan to introduce advertising to the chatbot.

According to the memo reported in The Information and Wall Street Journal, Altman said "code red" meant OpenAI would also delay progress with other products such as AI agents, which aim to automate tasks related to shopping and health.

With a half-a-trillion-dollar valuation, OpenAI is the world's most valuable private company.

Major investors are eager to take shares in the company, but questions are growing on how it can generate revenues that will match the huge costs of delivering AI to its hundreds of millions of users, the vast majority of whom use the service for free.

Google last month debuted its latest Gemini AI model, capping a dramatic turnaround since it was caught off guard by ChatGPT's launch three years ago and mocked for early blunders in its chase of OpenAI.

OpenAI did not immediately reply to a request for comment.

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