Moonshot AI Completes $500 Million New Funding Round, Zhilin Yang: Kimi Will Become a Distinctive LLM

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, and Gaorong Ventures, as an existing shareholder of Moonshot AI, also oversubscribed.

Throughout 2025, Moonshot AI achieved numerous breakthroughs and "SOTA results." In particular, the releases of K2 and K2 Thinking marked a significant step forward for the company on the path to AGI.

In his internal letter, Zhilin Yang also disclosed the company's upcoming goals. The Series C funding will be focused on accelerating the training and R&D of the K3 model. 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, the focus will be on agents to create greater productivity value and achieve order-of-magnitude revenue growth.

Continuously pushing the boundaries of AGI and daring to bet on uncharted technological territory — we look forward to Moonshot AI's continued evolution in the new year!

Below is Zhilin Yang's internal letter:

Thanks to our collective efforts, 2025 was a year of breakthroughs for Moonshot AI. The releases of K2 and K2 Thinking marked a significant step forward on our path to AGI. China's first trillion-parameter foundation model, the first open-source agentic model, achieving SOTA on core benchmarks such as HLE by surpassing OpenAI, a distinctive creative writing style beloved by global users, and the first successful large-scale training using a second-order optimizer — the K2 series of models brought Moonshot AI from China to the world, generating major impact in Silicon Valley and the broader global tech community, trending on Twitter globally, and earning high praise from prominent tech leaders including Nvidia's founder, the All-In Podcast hosts, Anthropic's co-founder, Perplexity's founder, a16z's founder, Vercel's founder, and Nobel laureates.

• They are all using Kimi K2 -

These technological breakthroughs also laid the groundwork for explosive product growth 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 SOTA performance of the K2 model, consumer-side commercialization grew exponentially. From September to November, overseas and domestic paying users grew at an average month-over-month rate of over 170%. Meanwhile, the release of K2 Thinking also significantly boosted API revenue, 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 heavily 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 most IPO proceeds and follow-on offerings by listed companies. So we are not in a hurry 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 at the right time with the initiative in our hands.

The Series C funding will be used to more aggressively expand our GPU fleet and accelerate the training and R&D of the K3 model. A portion of the funds will also be used for the 2026 incentive plan and option buyback plan. In 2025, based on SOTA results, various incentive measures including salary adjustments, option awards, and cash bonuses were granted 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 such as Anthropic and become a world-leading AGI company. The 2026 strategy will proceed along the following dimensions:

1. Through technical improvements and further scaling, the K3 model will increase effective FLOPs by at least one order of magnitude, catching up to world frontier models in pre-training capabilities.

2. Vertically integrate model training and agent product taste, making K3 a more "distinctive" model and allowing users to experience entirely new capabilities that other models have not defined.

3. Focus on agents for product and commercialization, not targeting absolute user numbers, continuously pursuing the upper limits of intelligence, creating greater productivity value, and achieving order-of-magnitude revenue growth.

This is a noisy era, but for me, Moonshot AI's starting point was simple: pure curiosity. Curiosity about where the upper limit of AGI lies, curiosity about what our ideal model looks like, curiosity about how to build the model capabilities we want. The joy that comes from this curiosity is very real. When the agent features we stayed up late to build finally went live, when we woke up every day and opened TensorBoard to see astonishing training curves. We shared these precious processes of approaching truth, and believe that 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 technological uncharted territory that others dared not bet on, or aesthetic convictions that require a bit of obsession, I believe there will be more Moonshot AI-defined innovations that make unique contributions to accelerating human civilization. This uniqueness is the greatest meaning of our existence. Let's keep pushing!