Chinese startup DeepSeek, which caused shockwaves across markets this year, quietly released an upgraded version of its artificial intelligence reasoning model.

The company did not make an official announcement, but the upgrade of DeepSeek R1 was released on AI model repository Hugging Face.

DeepSeek rose to prominence this year after its free, open-source R1 reasoning model outperformed offerings from rivals including Meta and OpenAI. The low-cost and short time of development shocked global markets, sparking concerns that U.S. tech giants were overspending on infrastructure and wiping billions of dollars of value of major U.S. tech stocks like AI stalwart Nvidia. These companies have since broadly recovered.

Just as was the case with DeepSeek R1’s debut, the upgraded model was also released with little fanfare. It is a reasoning model, which means the AI can execute more complicated tasks through a step-by-step logical thought process.

The upgraded DeepSeek R1 model is just behind OpenAI’s o4-mini and o3 reasoning models on LiveCodeBench, a site that benchmarks models against different metrics.

DeepSeek has become the poster child of how Chinese artificial intelligence is still developing despite U.S. attempts to restrict the country’s access to chips and other technology. This month, Chinese technology giants Baidu and Tencent revealed how they were making their AI models more efficient to deal with U.S. semiconductor export curbs.

Jensen Huang, CEO of Nvidia, which designs the graphics processing units required to train huge AI models, slammed U.S. export controls on Wednesday.

“The U.S. has based its policy on the assumption that China cannot make AI chips,” Huang said. “That assumption was always questionable, and now it’s clearly wrong.”

“The question is not whether China will have AI,” Huang added. “It already does.”

With his official stint in government coming to an end, Elon Musk thanked President Donald Trump on Wednesday for “the opportunity to reduce wasteful spending.”

Since joining the second Trump administration at the beginning of the term in January, Musk has led the Department of Government Efficiency, tasked with slashing the size of the federal government.

As a so-called special government employee, Musk can work for the administration for 130 days in a calendar year. The end of May marks 130 days since Trump’s inauguration.

“The @DOGE mission will only strengthen over time as it becomes a way of life throughout the government,” Musk wrote.

A White House official who was granted anonymity to describe personnel matters confirmed Musk’s departure and said he will begin offboarding Wednesday night.

Musk was critical of Trump’s spending bill that’s making its way through Congress, saying in a CBS interview set to air June 1 that it “undermines the work that the DOGE team is doing.”

Musk, the world’s richest person, is CEO of Tesla, SpaceX and artificial intelligence startup xAI. Musk said this week that he plans to focus more on his businesses.

On a Tesla earnings call in April, Musk said that his time spent running DOGE would drop significantly by the end of May. On the same call, he said that he would still spend a “day or two per week” on government work until the end of Trump’s term.

Musk has also said he plans to keep his small office at the White House.

During his first 100 days working with the Trump administration, Musk said in an interview with Fox Digital News that he had worked in Washington, D.C. on his DOGE initiative “7 days a week, or close to 7 days a week.”

Legal risks are now building up for Musk with myriad cases filed in the U.S. alleging that he violated federal laws while leading DOGE.

On Wednesday, pension fund leaders sent a letter to Tesla’s board saying that they should require Musk to put in 40 hours per week, at a minimum, at the EV maker as a condition to attain any future CEO pay package.

CNBC’s Chris Eudaily contributed to this story.

Elon Musk needs to spend more time at Tesla as his electric vehicle company faces a “crisis,” according to a letter on Wednesday from a group of pension fund leaders who manage investments in the company.

“Tesla’s stock price volatility, declining sales, as well as disconcerting reports regarding the company’s human rights practices, and a plummeting global reputation are cause for serious concern,” the investors wrote in a letter to Robyn Denholm, the company’s board chair. “Moreover, many issues are linked to Mr. Musk’s actions outside of his role as Technoking and Chief Executive Officer at Tesla, including his high-profile role as an architect of the U.S. Department of Government Efficiency (DOGE).”

The investors want the Tesla board to require Musk to work a minimum of 40 hours per week at the automaker as a condition of any new compensation plan they may arrange for him. They also want a clear succession plan for management of the EV business, and a policy that would apply to all Tesla directors limiting their outside board commitments at public and private companies.

Early last year, the Delaware Court of Chancery ordered Tesla to rescind Musk’s 2018 CEO pay package, which had been worth around $56 billion, finding that Musk controlled the company, and the board’s compensation committee misled shareholders before seeking their vote to approve the plan.

Musk now says he wants even more shares, amounting to 25% voting control of the company.

Tesla’s brand value and reputation have declined since 2024, due largely to Musk‘s incendiary rhetoric and political activities. In addition to pouring nearly $300 million into an effort to get Donald Trump back into the White House, Musk formally endorsed Germany’s far-right AfD party ahead of the country’s parliamentary election this year.

At DOGE, Musk has led an initiative by the Trump administration to slash federal agencies.

Tesla once ranked eighth among the most popular American brands in the Axios Harris Poll of public perceptions of the 100 most visible U.S. companies. But recently, Tesla dropped to 95th, behind six other automakers in that poll.

Tesla’s stock price is down 12% this year, while the Nasdaq is down just 1%.

Data this week revealed that Tesla’s monthly sales across Europe plunged by nearly half in April compared to the same time last year. That trend extends the steep declines Tesla saw in the first quarter.

The investors who signed Wednesday’s letter own about 7.9 million shares in the company combined. They blamed a Tesla board that’s “unwilling to act in the best interest of all Tesla shareholders” by requiring Musk’s “full-time attention” on the company.

Musk said this week that he plans to focus more on his businesses, which include xAI and SpaceX in addition to Tesla.

Those who signed the letter included the pro-labor SOC Investment Group, American Federation of Teachers, New York City Comptroller Brad Lander and Oregon State Treasurer Elizabeth Steiner.

The investors asked Tesla to add at least one new independent director with no personal ties to other board members. Tesla earlier this month said former Chipotle CFO Jack Hartung will join the company’s board. Hartung previously worked with Musk’s brother and Tesla board member Kimbal Musk, who was a board member at the Mexican food chain.

Tesla didn’t respond to a request for comment in response to the letter.

Read the investors’ letter in full here.

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