Microsoft Corp. (MSFT  ), Amazon.com Inc. (AMZN  ) and Alphabet Inc. (GOOGL  ) (GOOG  ) are reportedly in early talks with China's Moonshot AI over revenue-sharing deals for its Kimi K3 model, weeks after Treasury Secretary Scott Bessent said he might add the company to a U.S. trade blacklist. Moonshot is seeking as much as 30% of revenue generated by K3-related services running on Azure, Amazon Web Services and Google Cloud, according to Reuters. The talks are preliminary and may not produce agreements.

The striking part isn't the revenue-sharing model itself. Three of the largest U.S. technology companies may be building a direct commercial relationship with a Chinese developer that Washington has accused of taking American technology.

Bessent Threatens the Very Relationships Moonshot Needs

Bessent warned last month that Chinese AI developers could face sanctions and Entity List designations over what he called industrial-scale distillation attacks on U.S. models.

"Open source is not open season on American IP," he said.

U.S. officials have accused Moonshot of using outputs from Anthropic's Fable model to help build Kimi K3 and of improperly acquiring restricted Nvidia Corp. (NVDA  ) chips. Moonshot denies the distillation claim and told China's National Business Daily that K3's gains came from original changes to its underlying architecture.

No sanctions have landed. Washington is weighing whether to cut Moonshot off from the U.S. AI ecosystem while three American clouds weigh whether to help it monetize that same ecosystem.

Why Microsoft, Amazon And Google Want Kimi K3

The interest is commercial. Moonshot charges $3 per million uncached input tokens and $15 per million output tokens, well below many Western frontier models.

K3 has 2.8 trillion parameters, and analysts say the computing costs make it impractical for most customers to run themselves. Those customers instead need companies such as Microsoft, Amazon and Google to provide the computing power.

That creates a revenue opportunity for the hyperscalers. They can sell access to a highly competitive model over infrastructure they already operate, while sharing a portion of the resulting revenue with Moonshot. Artificial Analysis rates K3 alongside OpenAI's GPT-5.5 and Anthropic's Claude Opus 4.8.

Reuters said an agreement could mark the first major revenue-sharing deal between a Chinese AI company and a U.S. cloud provider. Moonshot has previously struck similar arrangements with smaller platforms.

Traders Give Moonshot A Shot At No. 1

Prediction-market traders still see a path for Moonshot to reach the top. Polymarket gives the Chinese lab an 11% chance of holding the world's No. 1-ranked AI model at some point by Dec. 31, on about $130,000 in volume.

The bar is higher for staying there. In a separate $800,000 year-end market, Moonshot has roughly a 1% chance of finishing 2026 with the world's best-ranked model, behind Anthropic, xAI, Google and OpenAI.

The cloud talks come as Moonshot prepares for a potential Hong Kong IPO. Benzinga previously reported that the company was discussing a valuation approaching $50 billion, putting pressure on Moonshot to turn K3's technical momentum into commercial revenue.