OpenAI finds itself navigating a challenging landscape, despite its reputation as a financial powerhouse. Recently, the company secured an impressive $122 billion in funding, elevating its valuation to a staggering $852 billion. With the possibility of an IPO on the horizon this year, OpenAI has established itself as a household name in AI, much like “Kleenex” has for tissues. However, a series of executive changes, project cancellations, and other developments have sparked concerns about the company’s stability and its future dominance in the industry.

The controversies surrounding OpenAI began to surface earlier this year. In February, the company agreed to a substantial contract with the Pentagon, a move that its competitor Anthropic avoided due to ethical concerns regarding autonomous weapons and domestic surveillance. This decision stirred debate both within and outside the organization, prompting CEO Sam Altman to admit that OpenAI appeared “opportunistic and sloppy” in its approach.

Adding to the turmoil were unexpected product announcements. Just last month, OpenAI abruptly decided to discontinue Sora, an AI video-generation app initially intended for integration with ChatGPT. The company also terminated its partnership with Disney so abruptly that the collaboration was ongoing just 30 minutes before Disney learned of the shutdown. Plans for a ChatGPT sexting feature were also shelved. In a strategic pivot, OpenAI announced a shift in focus towards enterprise and coding tools, with executive Simo reportedly advising against missing critical opportunities due to “side quests.” Even the once-promising Stargate data center project seems to have lost momentum.

Last Friday, OpenAI revealed significant changes to its executive team. Fidji Simo, CEO of AGI deployment, is stepping back temporarily due to medical leave, with company president Greg Brockman taking over her responsibilities, including leading the super app initiative. CMO Kate Rouch has decided to leave to prioritize her health, and Brad Lightcap has transitioned from his role as COO to focus on special projects directly reporting to Altman.

This week, a detailed article in The New Yorker delved into longstanding allegations that Sam Altman may have misled OpenAI’s board, its former executives, and others he worked with in previous roles before co-founding the company.

Looming on the horizon is a potentially contentious legal battle with co-founder Elon Musk, scheduled for later this month. The lawsuit has already exposed a trove of internal communications from OpenAI’s formative years, adding another layer of intrigue to the company’s narrative.

The barrage of recent changes, and headlines, have seemed to leave the company reeling — and looking to control its narrative. Last week OpenAI announced that it was acquiring TBPN, the online viral news show. Simo wrote that it made the deal to “help create a space for a real, constructive conversation about the changes AI creates—with builders and people using the technology at the center.” She wrote, “As I’ve been thinking about the future of how we communicate at OpenAI, one thing that’s become clear is that the standard communications playbook just doesn’t apply to us.”

OpenAI is vulnerable, especially as it nears its potential IPO. As investors pour in billions of dollars, all eyes are on its balance sheet. CFO Sarah Friar has reportedly expressed concerns that the company isn’t ready to go public as soon as Altman desires. There’s never been more pressure to generate revenue. The company did not immediately respond to a request for comment from The Verge.

In the past, Altman hadn’t expressed much concern about when and how OpenAI would turn a profit; in 2024, reports suggested that the company didn’t expect to do so until 2029. At OpenAI’s annual Dev Day in October, Altman told reporters, “Obviously, someday we have to be very profitable, and we’re confident and patient that we will get there.” But he appeared defensive later that same month on a podcast appearance, when host Brad Gerstner told him “The single biggest question I’ve heard all week, and hanging over the market, is ‘How can a company with $13 billion in revenue make $1.4 trillion in spend commitments? You’ve heard the criticism, Sam.” Altman interrupted to respond, “First of all, we’re doing well more revenue than that. Second of all, Brad, if you want to sell your shares, I’ll find you a buyer. I just… Enough.” And in December, Altman reportedly announced that the company was declaring a “code red” amid competition to ChatGPT.

As the pressure builds to square OpenAI’s revenue with its nearly unprecedented spending, the company is looking to put its compute behind projects with the highest profit potential.It’s attempting to catch up to leading rival Anthropic’s current popularity in coding, while also facing significant competition from Google, since Gemini is well-integrated within Google’s ecosystem of apps and tools. It’s possible the company will find a way to pull ahead — but things may not be going as smoothly as Altman hopes.