US AI lead over China shrinks sharply as DeepSeek closes in

The US lead in artificial intelligence is getting a lot harder to see. American AI companies’ performance edge over Chinese rivals has dropped sharply, Bloomberg reports, with DeepSeek’s progress doing much of the work. The numbers behind that shift are stark. According to the Stanford 2026 AI Index, the performance gap between top US and Chinese models had shrunk to 2.7%, or 39 points, by March 2026. In May 2023, that gap stood at more than 1,300 points. How the gap closed DeepSeek sits at the center of the story. The Chinese lab launched its R1 reasoning model in January 2025, a release that put Chinese AI squarely on the global radar. It followed up with the V4 series, which began rolling out in April 2026. The V4 models brought open-weight access and meaningful cost advantages over US alternatives. Price is where DeepSeek really competes. DeepSeek V4-Pro costs approximately $3.96 per million output tokens, which significantly undercuts its US competitors. Developers have noticed. As of mid-2026, Chinese models captured between 50-67% of token processing on OpenRouter, a platform that routes developer requests across many different AI models. Where the US still leads The scorebo...