OpenAI is putting its ad ambitions on hold. The company has paused all new ad plans while it shifts resources toward improving the core AI system that runs ChatGPT. This update comes from a Wall Street Journal report that cites an internal memo from CEO Sam Altman, who told employees he was calling a "code red" to raise the product’s overall quality.

The memo explains that OpenAI is pushing back several initiatives. Ads are one of them, along with the company’s AI agent projects that were meant to help users automate tasks like shopping or managing health appointments. The report also says the company is delaying Pulse, a personal assistant that was designed to create individualised reports.

Previous report says the company was testing ads in ChatGPT

OpenAI has not officially confirmed any plans to launch ads, but the WSJ report points to internal testing that includes promotional content related to online retail and product buying. A source familiar with the work told the outlet that the company has already been experimenting with commercial content formats.

Earlier this week, a separate report supported this direction. According to the report, computer engineer Tibor Blaho spotted signs of an ad-serving system in the ChatGPT Android beta. Blaho examined version 1.2025.329 and found references to an ads feature, search ad, search ads carousel, and something labeled bazaar content.

A pause does not remove the possibility of ads. If OpenAI eventually rolls out ads inside ChatGPT, it would be contrary to Altman’s earlier stance. He once said ads would be a last resort for the company. More recently, he has acknowledged that ads can be effective when executed properly.

Why OpenAI is shifting focus right now

According to the WSJ report, Altman wants to improve the day-to-day quality of ChatGPT before moving forward with broader product plans. The company wants to strengthen the product before expanding into new lines of business. Altman reportedly told employees that the company needs to widen the range of questions the chatbot can handle while also improving speed and reliability. Nick Turley, head of ChatGPT, posted on X that the team is focused on expanding the product while making it feel more "intuitive and personal."

This decision also comes as competition in the AI market grows. Google’s upgraded Gemini model recently topped OpenAI in several benchmarks and has seen its user base rise from 450 million monthly users in July to 650 million in October. According to the WSJ, part of that growth has come from features like the Nano Banana image generator, which Google expanded into Search across more than 15 countries.

Perplexity is also building its own competitive angle. Like OpenAI, it now supports in-chat shopping, which lets users purchase directly through its interface.

OpenAI’s financial model still relies on premium products like ChatGPT Plus and enterprise partnerships. However, OpenAI faces rising operational costs for running large-scale AI systems. Adding ads would open the platform to more revenue streams and help it stay financially sustainable.

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