Why is MiniMax stock sliding today?
MiniMax Group Inc.'s stock is plunging nearly 9.8% to HK$169.2 today, following concerns over a new AI model dubbed M3.1 Flash. The company's AI model generated scrutiny due to its high hallucination rate, raising doubts about the model's quality. This decline in MiniMax's stock follows a broader downturn in Hong Kong's top AI model stocks, with Zhipu AI also down over 5%.
Investors are questioning whether the spending on AI models is sustainable and the frequency of major updates by Chinese developers, who face intense competition from U.S. rivals. MiniMax had not launched a new flagship text model in more than four months since the release of M3, despite the newer model promising to cut usage costs by 70%.
However, the drop in MiniMax's stock has pushed shares below their Hong Kong IPO price, marking a decline from their March peak as competition over model pricing intensifies and a broader technology selloff continues.
Written by urgent.news from Investing.com's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
