Ultraman internal memo exposed: OpenAI's lead is narrowing, warning of "difficult times" ahead

OpenAI CEO Sam Altman warned employees in an internal memo that the company's technological lead is narrowing, and he expects the outside environment to be "quite tough" for some time. This rare warning signal shows that the $500 billion-valued AI giant, which has received over $60 billion in investment, is facing unprecedented competitive pressure. On November 21, according to tech media The Information, Altman admitted in last month’s internal memo that Google’s latest advances in artificial intelligence "may bring our company some temporary economic headwinds," and warned employees, "I expect the outside environment to be rather tough for a while." He frankly stated that Google’s newly developed AI seems to have surpassed OpenAI in development methods, "We know there is still work to do, but we are catching up quickly." According to the report, this internal statement foreshadows the significance of [Google's release of Gemini 3 this week](https://wallstreetcn.com/articles/3759657). Software developers indicate that this AI model excels at automating website and product design-related tasks and programming—while programming capabilities are one of the most important revenue drivers for AI companies like OpenAI. More severe is that OpenAI’s competitors are making breakthroughs on multiple fronts. According to The Information's previous report, Anthropic—founded only four years ago—may surpass OpenAI in revenue this year by selling AI to developers and enterprises. Meanwhile, although ChatGPT still leads Google's Gemini chatbot significantly in usage and revenue, the gap is shrinking. ## Leading technological edge under challenge The report states that Google’s breakthroughs in AI pre-training surprised many AI researchers. Pre-training is the first stage in developing large language models, during which researchers expose the model to data from the web and other sources to teach it relationships within the data. Altman admitted in the memo, "From all perspectives, Google has been doing excellent work recently," especially in pre-training. This was exactly the area where OpenAI once struggled to make progress, and Google had also encountered difficulties before. These challenges previously prompted OpenAI to increasingly shift to a new type of AI called inference models, which use more processing power to produce better answers. According to The Information’s earlier report, before OpenAI launched the GPT-5 model this summer, employees realized that tweaks made during pre-training were effective for smaller models but ceased to work as model size grew. This indicated that OpenAI needed to solve these pre-training issues to catch up with Google in this area. Last month, Altman assured employees that OpenAI would make progress in the coming months, including launching a new large language model codenamed Shallotpeat. According to sources, the company aimed to fix bugs encountered in the pre-training process during the development of this model. ## Competitors making multi-front breakthroughs The report also pointed out that OpenAI’s dominance is being shaken. Anthropic, founded by former OpenAI staff, specializes in generating computer code based on customer needs—from developing new applications to updating existing code. According to The Information earlier this month, this four-year-old company may surpass OpenAI this year in revenue from selling AI via APIs to software developers and businesses. Meanwhile, Google continues to promote the Gemini chatbot through its search app and other products, competing with OpenAI’s ChatGPT. Although ChatGPT still leads Gemini chatbot significantly in usage and revenue, the gap continues to narrow. Altman stated in the memo: > "For most people, ChatGPT is AI, and I expect this will continue." The report also noted that Google’s other advantage lies in its financial strength. OpenAI is one of the fastest-growing companies in history, with revenue growing from virtually zero in 2022 to the projected $13 billion this year. However, the company also expects to spend more than $100 billion over the next few years in pursuing human-level AI, as well as billions renting servers, which means it may need to raise a correspondingly large amount of additional capital. By comparison, Google—valued at $3.5 trillion—generated over $70 billion in free cash flow in the past four quarters alone. While ChatGPT has apparently eaten into Google Search’s market share, Google's financial performance has improved in part because of its thriving cloud business, which rents servers to major customers including OpenAI and Anthropic. The financial gap between OpenAI and mature enterprises like Google has prompted public market investors to question whether this startup's unprecedented revenue growth (including projected growth) will be enough to eliminate concerns over its future cash consumption. ## Focus on long-term “ambitious bets” Despite the pressure, Altman stated he hopes to focus on "very ambitious technical bets," even if it means OpenAI will "temporarily fall behind under the current regime." These bets include progress in using AI-generated data to train new AIs and "post-training" techniques such as reinforcement learning, which essentially evaluates model answers positively or negatively so the model can learn to improve. Altman has privately and publicly discussed the company’s gambles on automating AI research itself to accelerate breakthroughs, including letting AI surpass human capabilities in fields from energy and biotech research to healthcare. Altman said in the memo: > "We need to stay focused under short-term competitive pressure. Our company has accumulated enough strength to withstand excellent models released elsewhere. But having most of our research team focus on truly achieving superintelligence is essential." He added: "I don’t want this letter to be discouraging—we are doing extremely well as a company...I expect this will continue." He wrote at the end of the memo: > "We have to do so many difficult things at the same time—the best research lab, the best AI infrastructure company, and the best AI platform/product company—it's tough, but it's our destiny. And I wouldn't trade places with any other company." Risk Warning and Disclaimer The market has risks, and investment should be cautious. This article does not constitute personal investment advice and does not take into account the specific investment objectives, financial situation, or needs of individual users. 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