As competition in China’s artificial intelligence space accelerates, Alibaba-backed Moonshot AI has launched an upgraded version of its flagship Kimi model. The new release comes just ahead of an expected model debut from DeepSeek AI, adding fresh momentum to the country’s fast-moving AI race.
Moonshot AI’s latest K2.5 model is designed to process text, images, and video within a single prompt. This capability reflects the global shift toward omni models that can handle multiple data types at once. The launch arrives during what was earlier described as the “War of One Hundred Models,” a phase marked by rapid upgrades across the sector following DeepSeek’s R1 breakthrough in early 2025.
Several major players are pushing forward with new capabilities. Companies such as Zhipu, MiniMax, and Alibaba continue to introduce upgraded models as competition intensifies across both open-source and proprietary systems.
Moonshot AI was founded by Yang Zhilin and has recently raised $500 million in funding from investors including Alibaba and IDG Capital. The company is reportedly targeting a valuation of up to $5 billion. According to Moonshot, the K2.5 model performs better than comparable open-source alternatives and is steadily closing the gap with leading proprietary models.
With this release, Moonshot AI is positioning itself as a stronger contender in China’s evolving AI ecosystem, as companies race to deliver more advanced and versatile models.
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