Moonshot seeks 30% revenue share from Microsoft, Amazon, Google

Moonshot AI is negotiating revenue-sharing agreements with Microsoft, Amazon and Alphabet's Google that would let the US cloud giants host its Kimi K3 model, three people familiar with the talks said. Any deal would mark the first major revenue-sharing pact between a Chinese AI firm and a major US cloud company.

IPO-bound Moonshot is seeking up to a 30 percent share of revenue generated from K3-related services on Microsoft's Azure, Amazon Web Services and Google Cloud, according to the sources, who declined to be identified because the discussions are private. That would be in line with terms the startup has outlined for major customers using the open-weight model.

Kimi K3 has posted strong results in third-party evaluations. Arena.ai ranked it first in a benchmark assessing web interface-building capabilities, while Artificial Analysis says it delivers performance comparable to OpenAI's GPT-5.5 and Anthropic's Claude Opus 4.8, particularly on tests measuring complex, multi-step tasks.

For large AI model providers like Moonshot, major cloud providers are the main route to enterprise adoption. Although Kimi K3 is an open-weight model that can be downloaded and modified, analysts say few customers are likely to run a system with 2.8 trillion parameters on their own infrastructure because of the huge computing costs involved.

Unresolved Terms and US Pressure

According to one of the sources, unresolved issues in Moonshot's negotiations with the US cloud companies include how revenue might be split, data access and auditing token usage. Tokens are units of text processed by AI models, and measuring their use is central to calculating revenue under usage-based billing.

The discussions come as national security concerns in Washington have led to bans on exports of AI chips to China. US Treasury Secretary Scott Bessent said last month he might add Moonshot to a trade blacklist. US officials have accused the Beijing-based company of stealing from Anthropic's most sophisticated model, Fable, to help create Kimi K3 and illegally acquiring Nvidia chips.

Moonshot has rejected suggestions that Kimi K3's performance was achieved via distillation, telling China's National Business Daily last month that its performance gains came from original changes to underlying architecture.

Moonshot's IPO Push and Alibaba's Parallel Play

Founded in 2023 by Carnegie Mellon-trained AI researcher Yang Zhilin, Moonshot is backed by several Chinese tech giants including cloud computing giant Alibaba. The startup raised more than $2 billion in May and is preparing for a potential Hong Kong listing, sources have said.

Moonshot has signed similar revenue-sharing agreements with some smaller cloud platforms, the sources said, without providing details. In July, Chinese IT services provider Chinasoft International said it had a revenue-sharing agreement with Moonshot, though it did not disclose how the revenue will be split.

Alibaba is also seeking revenue-sharing agreements with major users of its new open-source AI model, sources have also said.

The talks show how China's leading AI models, often far cheaper than Western offerings, are gaining traction in the US. If finalized, the revenue-sharing structure could set a precedent for how Chinese AI models reach global enterprise customers through US cloud platforms, giving Moonshot a recurring revenue stream ahead of its Hong Kong listing while handing Microsoft, Amazon and Google a competitive model to offer their customers.

This article is for informational purposes only and does not constitute investment advice.