Moonshot AI Releases Kimi K3 — 2.8-Trillion-Parameter Open-Weight Model Rivaling OpenAI, Anthropic — Sparks Nasdaq Chip Stock Selloff

Beijing-based Moonshot AI unveiled Kimi K3 on July 16-17 and released open weights July 27, a roughly 2.8-trillion-parameter mixture-of-experts model with a 1-million-token context window, priced at $3/$15 per million tokens, CNBC and TechCrunch reported. Moonshot said K3 'still trails the most powerful proprietary models' but 'demonstrated frontier-level performance' across its evaluation suite, outperforming other tested open models. The release — coinciding with a speech by President Xi Jinping — rattled US markets: the Nasdaq dropped roughly 1% on July 18 as investors sold chip stocks on renewed concern about China's ability to match frontier AI capability with open, freely downloadable models. Reaction split sharply: some US commentators framed the open-weight release as enabling adversarial 'AI diffusion,' while others called the alarm overblown given K3 still lags Claude and GPT frontier models on key benchmarks. Moonshot's Kimi chatbot already has annualized recurring revenue exceeding $200 million (as of April 2026), and K3's 1M-token context targets long-horizon coding and agentic workloads — directly competing with DeepSeek V4-Flash in China's increasingly crowded low-cost frontier-model race.