5Y News｜Moonshot AI Closes $500 Million Series C Round, Aims to Become a World-Leading AGI Company

On December 31, 2025, Zhilin Yang, founder and CEO of Moonshot AI, sent an internal letter announcing that the company had recently completed a $500 million Series C funding round. The round was led by IDG, with existing shareholders Alibaba and Tencent oversubscribing. 5Y Capital, also an existing shareholder of Moonshot AI, oversubscribed as well. The proceeds will be used to aggressively expand GPU capacity and accelerate the training and R&D of the K3 model.

Over the past year, Moonshot AI achieved numerous breakthroughs and "state-of-the-art results," with the releases of K2 and K2 Thinking in particular marking an important step forward for the company on the path to AGI.

In his internal letter, Zhilin Yang stated that the company's most important goal going forward is to surpass frontier companies like Anthropic and become a world-leading AGI company. Additionally, in 2026 the company will vertically integrate model training and agent product taste, making K3 a more "distinctive" model; on the product and commercialization front, it will focus on agents to create greater productivity value and achieve order-of-magnitude revenue growth.

Below is Zhilin Yang's internal letter in full:

Through our collective efforts, 2025 has been a year of breakthroughs for Moonshot AI. The releases of K2 and K2 Thinking marked an important step forward for us on the path to AGI. China's first trillion-parameter foundation model, the first open-source agentic model, achieving state-of-the-art results on core benchmarks such as HLE by surpassing OpenAI, a uniquely creative writing style beloved by users worldwide, the first successful large-scale training using a second-order optimizer — the K2 series has taken Moonshot AI from China to the world, generating significant influence in Silicon Valley and the broader global tech community, trending on Twitter globally, and earning high praise from renowned technology leaders including Nvidia's founder, hosts of the All-In Podcast, Anthropic's co-founder, Perplexity's founder, a16z's founder, Vercel's founder, and Nobel laureates.

They're all using Moonshot AI K2

These technological breakthroughs have also laid the groundwork for product explosion and rapid commercial progress. Starting in May, the Moonshot AI product began frequently rolling out new agent features, launching Researcher, OK Computer, PPT, Kimi Code, and other new products with increasingly powerful capabilities. Leveraging the state-of-the-art performance of the K2 model, C-end commercialization grew exponentially, with overseas and domestic paying users averaging over 170% month-over-month growth from September to November. Meanwhile, the release of K2 Thinking also significantly drove API revenue growth, with overseas API revenue increasing 4x from September to November.

Thanks to these breakthroughs, the company recently completed a $500 million Series C funding round that was significantly oversubscribed, with current cash holdings exceeding 10 billion RMB. Compared to the secondary market, we believe we can still raise larger amounts from the primary market — in fact, our combined Series B and C funding already exceeds the vast majority of IPO proceeds and follow-on offerings by listed companies. So we are not in a rush to go public in the near term. Of course, we plan to use going public as a means to accelerate AGI in the future, acting when the time is right, with the initiative in our hands.

The Series C proceeds will be used to aggressively expand GPU capacity and accelerate K3 model training and R&D. A portion of the funds will also go toward the 2026 incentive plan and option buyback program. In 2025, based on state-of-the-art results, various incentive measures including salary adjustments, option grants, and cash bonuses were awarded to 324 people in total. Before the 2026 Spring Festival, the reward plan for K2 Thinking and subsequent model and product releases will be finalized and distributed. The company's average incentives in 2026 are expected to be 200% of 2025 levels, while the option buyback quota is planned to be significantly increased — detailed plans will be announced soon.

The company's most important goal going forward is to surpass frontier companies like Anthropic and become a world-leading AGI company. Our 2026 strategy will proceed along the following dimensions:

• Model: Vertically integrate model training and agent product taste, making K3 a more "distinctive" model

• Product: Focus on agents, create greater productivity value, and achieve order-of-magnitude revenue growth

• Talent: Continue attracting top talent and build a world-class AGI team

This is a noisy era, but for me, Moonshot AI's starting point was simple — pure curiosity. Curiosity about where the upper limits of AGI lie, curiosity about what our ideal model looks like, curiosity about how to build the model capabilities we want. The joy this curiosity brings is very real. When the agent features we stayed up late building finally go live, when we wake up and open TensorBoard to see astonishing training curves. We have shared these precious processes of approaching truth, and believe this simple joy can carry us through cycles amid the noise.

In 2026, Moonshot AI will become a "distinctive" and "undefined" LLM. Whether it's technical uncharted territory that others dared not bet on, or aesthetic convictions requiring a bit of obsession, I believe there will be more Moonshot AI-defined innovations that make unique contributions to accelerating human civilization. This distinctiveness is the greatest meaning of our existence. Let's keep pushing!

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