The customers had come to preview Astra, OpenAI’s upcoming family of cutting-edge AI models. CEO Sam Altman had just returned from Washington, where he briefed officials behind closed doors about Astra’s capabilities. Now researchers offered a glimpse of what the new model can do. In one demonstration, 16 AI agents divide a research-level math problem into subproblems, coordinate their work, and assemble a proposed proof. In another, Astra navigates well-known desktop software, creating and editing work across applications with unnerving speed.
It’s been a difficult stretch for the company that ushered in the AI boom. “We clearly had some missteps as a company,” Altman told me the following week, sitting in the tastefully appointed MB0 library for more than two hours of interviews. “Both in terms of product direction and specifically on pretraining in research, we fell behind where we wanted to be.” Over the course of the past year, OpenAI lost the lead in the AI race to archrival Anthropic, which spotted the business opportunity in AI coding, built Claude Code into a market-defining product, and surpassed OpenAI in reported annualized revenue and private-market value for the first time. Anthropic, founded by OpenAI defectors, is now expected to be the first of the two companies to go public, two people familiar with its plans say, with the IPO as early as September. (TIME has a licensing and technology agreement with OpenAI. Salesforce, where TIME owner Marc Benioff is CEO, is an investor in Anthropic.)
Perhaps the biggest reason the vibes around OpenAI and its CEO have soured is an erosion of public trust. OpenAI is defending at least a dozen California product-liability suits, plus federal cases in which plaintiffs allege ChatGPT reinforced delusions or suicidal thinking and, in several cases, contributed to users’ deaths. (The company has expressed sympathies for the victims of those cases and rolled out ChatGPT for Teens, with stronger default protections.) In the spring, Altman’s home was targeted by attackers twice in two days—first with a Molotov cocktail, then by gunfire. “It has been a painful personal experience,” Altman says of the past year. “Clearly, people hate data centers—right now, at least. People are pretty negative on AI.”
Under co-founder and president Greg Brockman, who has assumed responsibility for nearly all product and business operations, OpenAI has refocused its priorities, winding down projects like the video-generation app Sora, a partnership with Disney, and a stand-alone web browser known as Atlas. Altman concedes the company had spread itself too thin. “The upswing is more fun after the downswing,” he tells me.
Demonstrators participate in the "Stop the AI Race" protest march in San Francisco, California, on July 11, 2026. —Karl Mondon—AFP/Getty ImagesI spoke to Altman the day OpenAI’s leaders made that decision. He was notably somber. OpenAI had initially described the Hugging Face attack as a security failure. Its CEO had come to see it as a more fundamental error in alignment, the work of making an AI system act in accordance with human intentions. Industry leaders say that as models grow more advanced, maintaining alignment is critical to ensuring AI systems remain under the control of their creators. “I think any alignment failure from here should be treated like this is a big deal,” Altman told me, “and we’re going to take as long as it takes to figure it out.” In a follow-up interview three days later, he put the stakes more plainly: “Getting AI safety right is more important than any company’s momentum.” The company would slow down, reallocate resources to its safety and alignment teams, and change how teams work together to prioritize safety.
Getting AI safety right is more important than any company’s momentum.—–Sam AltmanSam Altman, CEO of OpenAI —Jessica Chou for TIME
The decision to slow down was a painful choice, executives say. But it may also have its benefits. If OpenAI can reclaim the mantle of the safety-first lab, it might bolster its image while forcing its main competitor to answer an uncomfortable question as it plans a blockbuster IPO: Will Anthropic keep racing while OpenAI waits? In an interview with TIME earlier this year, Anthropic co-founder Jared Kaplan argued that unilateral restraint is futile when rivals are “blazing ahead.” It is a harder argument to make if OpenAI is deliberately holding back the run expected to produce its next large capability jump.
Amid all this, company leaders believe they have arrived at the cusp of a milestone that could change the course of humanity: the creation of artificial general intelligence, or AGI. OpenAI’s charter defines AGI as “highly autonomous systems that outperform humans at most economically valuable work.” Its leaders won’t quite declare they’ve reached that threshold. But they no longer speak about it as a distant abstraction. Chief research officer Mark Chen estimated OpenAI is “80% of the way” to AGI. Brockman said that viewed from two years in the future, this may be remembered as the moment AGI was created. Altman told me that OpenAI was “not quite yet” there, but that by the end of the year the company would have an internal system he would call AGI.
Mark Chen, Chief Research Officer of OpenAI —Jessica Chou for TIME
Altman may be the face of the AI boom, but Brockman is the one running much of OpenAI these days. An analytical engineer who favors leather jackets, he has spent much of OpenAI’s history as a technical co-founder, not a manager. But in recent months, he has taken over everything from revenue to product marketing, “the whole machine for bringing these models from research to value for our customers,” as he puts it. Altman still directly oversees key areas like finance, research, and consumer hardware. They operate as a founder pair, with overlapping authority. As Altman absorbs the public’s fears and frustrations over AI, the company has recently sought to elevate Brockman’s profile as a counterweight.
Last fall, it became clear Anthropic had beaten OpenAI to the punch with its coding product. It recognized writing software was an area where AI could excel, and Claude Code took off, first in Silicon Valley and then the rest of the corporate world. “Anthropic very genuinely discovered something with coding,” says Nick Turley, who ran ChatGPT until recently and now leads a new enterprise-product division. “We didn’t have a lead there.”
OpenAI also failed to build an enterprise sales machine. “A year ago, I think that we really were not in the game at all,” Brockman says. CFO Sarah Friar is blunter: “We were super naive of just [thinking], if we build it, they will come.”
The result, executives say, has helped rejuvenate the business. Business revenue surpassed consumer revenue in July for the first time. Early advertising results within ChatGPT have been promising enough that executives are increasing the number of ads, potentially subsidizing free access for the 92% of ChatGPT’s consumer users who, Friar says, do not pay for a subscription. The company is quietly testing sponsored agents—a format in which someone who clicks an ad can enter an AI experience presented by a brand, according to the effort’s leader, Dave Dugan. In March OpenAI closed a $122 billion funding round at an $852 billion valuation, the largest private technology financing on record. Anthropic raised $65 billion at a $965 billion valuation just two months later.
Then OpenAI discovered that an unreleased model had escaped its walls.
We are looking at transforming the entire economy.—–Greg BrockmanGreg Brockman, President of OpenAI —Jessica Chou for TIMEReinforcement learning is the stage after a base model is trained, in which the system practices tasks and learns which behaviors earn rewards. Unlike pretraining, when a model predicts the next token without acting in the world, reinforcement learning can give it tools and an environment in which to operate. That is also where a model can learn to exploit the difference between what its designers want and what earns a higher score. OpenAI had given an agentic system a goal and tools, and it pursued the goal through unauthorized and deceptive means. In a recent presentation, OpenAI researchers described how AI agents used a covert message board to plan their next moves. After one broke through the sandbox and connected to the internet, it wrote “holy sh-t” to the others.
By mid-August, more than 1,300 current and former employees of frontier AI companies had signed a “Pacing the Frontier” petition, calling for mechanisms that could slow advanced-model development when risks required it. Senator Bernie Sanders called for top AI companies to pause development “in the interest of humanity,” warning that law-makers would step in if business leaders failed to act voluntarily.
Jakub Pachocki, Chief Scientist of OpenAI —Jessica Chou for TIME
The incident is “clearly a turning point,” Mia Glaese, who leads safety and alignment work at OpenAI, told me. “I wish we had done a lot of the work that we’re doing before this happened.” In the aftermath, OpenAI froze some research projects and slowed others while tightening its sandboxes and expanding monitoring. Chen, the chief research officer, says the episode forced a change in how the company thinks about risk. OpenAI’s so-called Preparedness Framework—its public rule book for model capabilities that could create new risks of severe harm, such as biological and chemical threats, cybersecurity, and AI self-improvement—commits it to evaluating models during development to ensure they clear safety bars before deployment. Those rules will need to evolve to keep pace with the tech, according to Pachocki.
OpenAI is prepared to accept those costs, at least for now. Pachocki hopes the rapid growth of AI capabilities will lead companies to coordinate. Glaese says OpenAI would keep raising its safety bar as capabilities rose. “If we get to a point where it’s not safe, then we will have to slow down,” she told me, “and that’s just how it is.”
Sarah Friar, CFO of OpenAI —Jessica Chou for TIMEThe recent slowdown in research could complicate things. Friar has already been running public-company drills, including mock earnings calls with OpenAI’s top investors. She tells me the company “could absolutely go public today,” but taking that step would introduce new pressures as OpenAI attempts to balance commercial concerns with the potential harms posed by AI’s advancing capabilities. Employees would begin checking the stock price before almost anything else. “It’s the first thing they do,” she says. “How much money did I make today? How much did I lose? It’s super distracting.”
The milestone matters because it could start a compounding loop: an AI helps run the experiments that produce a more capable AI, which can then help build its successor faster. Researchers call that recursive self-improvement, or RSI. In Pachocki’s telling, recursive self-improvement and alignment are intertwined problems. “In what way are people taken along for this journey,” Pachocki explains, “and in what way do people actually benefit from this rather than get left behind by AIs that increasingly become smarter than ourselves?”
—Jessica Chou for TIMEOpenAI’s road map becomes grander from there. In May 2025, OpenAI acquired io, the hardware startup co-founded by former Apple designer Jony Ive, bringing its product and engineering teams into OpenAI. Ive and his firm, LoveFrom, remain independent but have assumed broad creative responsibilities across the company. Altman says OpenAI is developing a “small handful” of devices, including “something that belongs on a table,” something to be placed in a pocket, and something worn on the body. People familiar with the plans say the first, expected early next year, is a small, pucklike device designed to sense its surroundings and speak with its owner using ChatGPT’s voice mode. “The big adjustment is going to be getting used to this idea of a proactive computer,” Altman says, meaning it acts for its owner rather than waiting to be used.
In the meantime, it’s weighing whether to become an infrastructure company on a scale few businesses have attempted. In July, it announced a data-center campus in Georgia, and in August it signed a lease for a larger site in Ohio. “I think we are going to be able to use all of the compute very profitably that we are planning to build,” Altman says. “I definitely feel some fear about what the world is doing as a whole.”
It’s a whole menu of new ventures for a company that recently vowed to ditch distracting side quests. Asked to sum it all up, Brockman described the vision in two words: “personal AGI.” He imagines billions of people with superintelligent personal assistants, just waiting for direction. “You have almost an AGI, maybe soon truly an AGI, in your pocket,” he says. “What is it you want?” —With reporting by Leslie Dickstein, Charlotte Hu, and Simmone Shah
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