DeepSeek Narrows AI Gap with US, Says 01.AI Founder Lee Kai-fu

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China has significantly closed the artificial intelligence (AI) development gap with the United States, with companies like DeepSeek narrowing the divide to just three months in certain areas, according to Lee Kai-fu, CEO of Chinese AI startup 01.AI. Lee, a renowned figure in AI and former head of Google China, revealed in an interview that Chinese firms, particularly DeepSeek, have enhanced efficiency in chip usage and algorithm application, accelerating their progress.

DeepSeek’s launch of an AI reasoning model earlier this year challenged the assumption that U.S. sanctions were hindering China’s AI growth. The model, trained using less advanced chips, was cheaper to develop than its Western counterparts, shaking the global AI industry. Lee pointed out that previously, the gap between China and the U.S. was six to nine months, but now it has narrowed to just three months in some core AI technologies. In specific areas, Chinese companies have even surpassed their Western rivals.

Despite U.S. sanctions on semiconductors, which initially posed challenges, Lee believes that these constraints have driven Chinese companies to innovate. He noted that DeepSeek’s new approach to reinforcement learning—a technology that shows users the reasoning process before delivering answers—demonstrates this innovation, now on par or even ahead of U.S. developments.

Lee also highlighted that China’s tech sector, initially seen as trailing in AI development, rapidly entered the generative AI race after OpenAI’s ChatGPT launch in late 2022. With startups like DeepSeek and 01.AI entering the field, China’s AI capabilities have gained global attention.

Lee’s 01.AI, which he founded in 2023, focuses on practical AI applications rather than developing proprietary foundational models, aiming to help enterprises deploy AI solutions efficiently. The company launched Wanzhi, a software platform, earlier this month to assist businesses in integrating AI technologies, already generating revenue and forecasting substantial growth for 2025.

Cerebras IPO Delayed as US National Security Review Continues

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Cerebras Systems, a California-based AI chipmaker, has experienced further delays in its highly anticipated IPO due to an ongoing national security review by the Committee on Foreign Investment in the United States (CFIUS), sources familiar with the matter confirmed. The delay comes as the company waits for the White House to fill key positions and for CFIUS to conclude its review of a $335 million investment from Abu Dhabi-based cloud computing and AI company G42.

The delay marks a significant hurdle for Cerebras, which has been seeking to go public despite the uncertainty surrounding the approval of G42’s investment. G42’s past ties to China, particularly its connection to Huawei, have drawn scrutiny in Washington. However, the deal had appeared poised for approval late last year before the change in U.S. leadership.

CFIUS, which reviews foreign investments for national security risks, remains cautious about deals involving foreign companies with Chinese links. With the Biden administration’s expansion of CFIUS enforcement, corporate executives have found the regulatory environment less conducive to dealmaking than initially expected.

Despite the ongoing review, Cerebras executives remain optimistic that the investment will eventually be approved, and they intend to proceed with the IPO once the regulatory process is completed. The company’s valuation has nearly doubled since G42’s investment commitment last year, and the IPO remains a crucial step for Cerebras in securing funding for its future growth.

CD Projekt Posts 2.3% Drop in Full-Year Net Profit Amid Lack of New Game Releases

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Polish video game developer CD Projekt (CDR.WA) reported a 2.3% decline in its full-year net profit on Tuesday, mainly due to the absence of new game releases during the year. The company’s net profit stood at 469.9 million zlotys ($122 million), surpassing analysts’ expectations, which had forecasted a profit of 390 million zlotys, according to a Reuters poll.

While net profit decreased, the company’s revenue dropped nearly 20%, totaling 985 million zlotys for the year. CD Projekt’s performance was supported by the release of the long-anticipated expansion to its flagship game, “Cyberpunk 2077,” which boosted the previous year’s results.

Looking ahead, the company faces a couple of years without a major game release. Its revenue for the upcoming quarters is expected to be largely driven by sales from existing titles. “The results of the CD Projekt Group are primarily driven by sales of ‘Cyberpunk 2077,'” said finance chief Piotr Nielubowicz. “Even in the absence of any major launch, the past year was the third-best in the group’s history in terms of net profit.”

As of November 2024, cumulative sales of “Cyberpunk 2077” had surpassed 30 million copies, while its “Phantom Liberty” expansion had sold more than 8 million units. The company also plans to release “Cyberpunk 2077: Ultimate Edition” for macOS in 2024, aiming to tap into a new group of gamers.

In addition, CD Projekt is expanding the “Cyberpunk” universe, with a new animation project currently in development for Netflix, marking another step in the franchise’s growth.