A few weeks ago, OpenAI CEO Sam Altman declared ‘Code Red’ within the organisation as the Gemini 3 AI model from Google smashed GPT-5.1 in synthetic benchmarks. Instead of focusing on advertising opportunities and other earning solutions, Altman directed his employees to focus on improving the next-gen GPT model and stay competitive in the AI race, all in a bid to outdo the existential threat.
Released in November 2025, Gemini 3 has been hailed for superior performance in reasoning (MMLU tasks), coding accuracy, and multimodal comprehension, positioning Google as the new leader in AI model evaluations, according to industry analysts. Data analytics expert Similarweb now has the data on how much advantage Gemini 3 exercised over OpenAI’s latest GPT models in the last few months of 2025.
Great traffic trends for OpenAI
According to a report from Similarweb, the numbers paint a grim situation for OpenAI.
– ChatGPT’s seven-day average visitors dropped 22% over six weeks, from nearly 203 million to 158 million.
– Its market share slid from 87.2% to 68% – a 19% decline.
– Gemini experienced 28% month-over-month growth in December 2025, now holding 21.5% market share (up from 12.9% three months prior and 5.7% a year ago).
– Gemini commands close to 40% of ChatGPT’s web audience size, with its app reaching 650 million monthly active users (up from 450 million in July).
Tech researcher Rihard Jarc highlighted the shift on a post on X (formerly Twitter), stating, “You can feel the code RED here. $GOOGL is absolutely CRUSHING it with Gemini 3!”
Analysts note that Gemini’s market gains appear to come directly at ChatGPT’s expense, highlighting the competitive pressure.
Altman’s ‘Code Red’ response
In internal memos reported in late 2025, Altman declared a “Code Red,” instructing teams to pause monetisation initiatives, including ads, shopping assistants, and personal agents. The teams were directed to focus solely on enhancing ChatGPT’s performance to stay relevant in the race. He emphasised the situation’s urgency, calling it “existential” and warning of potential “economic headwinds.”
Why Google Gemini 3 is gaining market share rapidly
Several factors are said to contribute to Gemini’s advantage over GPT:
Ecosystem integration: Seamless embedding across Google’s products (Search, Android, Chrome) provides instant distribution.
Hardware advantage: Optimised for Google’s TPU v5 chips, lowering costs and improving efficiency.
Enterprise appeal: Strong compliance and cloud infrastructure attract large corporations.
Research pipeline: Backed by DeepMind and Google Research for continuous breakthroughs.
Additional boosts came from tools like the Nano Banana image editor, which helped expand Gemini’s popularity. Wall Street has responded positively, with Alphabet shares surging over 65% in 2025, making it a top performer among the “Magnificent Seven.” Bank of America noted Gemini’s potential as a “demand generator” for Search and Google Cloud.
