SHANGHAI -Chinese artificial intelligence startup DeepSeek released an update to its R1 reasoning model in the early hours of Thursday, stepping up competition with U.S. rivals such as OpenAI.

DeepSeek launched R1-0528 on developer platform Hugging Face, but has yet to make an official public announcement. It did not publish a description of the model or comparisons.

But the LiveCodeBench leaderboard, a benchmark developed by researchers from UC Berkeley, MIT, and Cornell, ranked DeepSeek's updated R1 reasoning model just slightly behind OpenAI's o4 mini and o3 reasoning models on code generation and ahead of xAI's Grok 3 mini and Alibaba's ( BABA ) Qwen 3.

Bloomberg earlier reported the update on Wedneday. It said that a DeepSeek representative had told a WeChat group that it had completed what it described as a "minor trial upgrade" and that users could start testing it.

DeepSeek earlier this year upended beliefs that U.S. export controls were holding back China's AI advancements after the startup released AI models that were on a par or better than industry-leading models in the United States at a fraction of the cost.

The launch of R1 in January sent tech shares outside China plummetting in January and challenged the view that scaling AI requires vast computing power and investment. Since R1's release, Chinese tech giants like Alibaba ( BABA ) and Tencent ( TCTZF ) have released models claiming to surpass DeepSeek's.

Google's Gemini has introduced discounted tiers of access while OpenAI cut prices and released an o3 Mini model that relies on less computing power.

The company is still widely expected to release R2, a successor to R1. Reuters reported in March, citing sources, that R2's release was initially planned for May. DeepSeek also released an upgrade to its V3 large language model in March.