Moonshot AI Releases Open-Source Model to Regain Market Momentum

 China's Moonshot AI releases open-source model to reclaim market position

Chinese artificial intelligence startup Moonshot AI has made a bold move by releasing a new open-source AI model called Kimi K2, aiming to re-establish itself in China’s highly competitive AI landscape.

The new model, Kimi K2, was launched on Thursday, July 11, 2025. According to the company, it excels in areas such as code generation, solving complex tasks, and integrating with digital tools. Moonshot says that Kimi K2 outperforms DeepSeek-V3, another strong open-source Chinese model, and even competes with U.S. models like Claude from Anthropic when it comes to certain tasks.

This release is part of a broader trend among Chinese tech companies, including Alibaba, Tencent, Baidu, and DeepSeek, which are increasingly embracing open-source strategies. By releasing models publicly, these companies are hoping to attract developer support and demonstrate technical transparency—while also countering restrictions from the United States on advanced AI technologies.

Founded in 2023 by Tsinghua University graduate Yang Zhilin, Moonshot AI gained early success with its Kimi chatbot, especially after receiving backing from Alibaba. However, the company faced growing competition in 2025, especially from rivals offering low-cost alternatives. The popularity of its Kimi app dropped from the third most-used AI app in China in August 2024 to seventh place by June 2025, according to third-party data from Data.ai.

To turn things around, Moonshot is betting on the power of open-source. By releasing the Kimi K2 model to the public, the company hopes to rebuild momentum, gain feedback from the developer community, and improve the model’s performance through broader usage.

The release of Kimi K2 highlights a growing shift in the Chinese AI sector—toward open access and shared innovation. It remains to be seen whether this strategy will help Moonshot reclaim its former influence, but it certainly signals a new chapter in the battle for AI leadership in China.