Microsoft has “tapped on the brakes” of its spending on artificial intelligence, reducing capital expenses by more than $1 billion in the first three months of 2025. But after 10 straight quarters of increased AI outlay, momentum continues to propel the sector forward with new data center commitments in 16 countries and the expansion of the Phi small language family with the debut of Phi-4 (that supports text, visual and voice inputs). The moves come on the heels of $70 billion in sales for the first three months of 2025, when profits were up 18 percent to $25.8 billion. Continue reading Microsoft Reduces Spending on AI but Momentum Continues

A new open-source code reasoning model called DeepCoder-14B-Preview has hit the market. Built atop DeepSeek-R1 and Qwen2.5 using reinforcement learning (RL), it aims to provide more flexibility by combining high-performance code generation with reasoning capabilities for real-world applications. Its performance is said to be comparable to OpenAI’s o3-mini, “but with a smaller footprint,” say its developers, the research-driven AI companies Together AI and Agentica. “We democratize the recipe for training a small model into a strong competitive coder,” explains Together AI. Continue reading Researchers Debut Preview of DeepCoder Reasoning Model

Google has released what it calls its most intelligent AI model yet, Gemini 2.5. The first 2.5 model release, an experimental version of Gemini 2.5 Pro, is a next-gen reasoning model that Google says outperformed OpenAI o3-mini and Claude 3.7 Sonnet from Anthropic on common benchmarks “by meaningful margins.” Gemini 2.5 models “are thinking models, capable of reasoning through their thoughts before responding, resulting in enhanced performance and improved accuracy,” according to Google. The new model comes just three months after Google released Gemini 2.0 with reasoning and agentic capabilities. Continue reading Google Debuts Next-Gen Reasoning Models with Gemini 2.5

OpenAI has decided to simplify its product offerings. A month after announcing the in-development GPT-o3 as its next frontier model, the company has canceled it as a standalone release, explaining that it would be integrated into the upcoming GPT-5 instead. “A top goal for us is to unify o-series models and GPT-series models by creating systems that can use all our tools, know when to think for a long time or not, and generally be useful for a very wide range of tasks,” OpenAI co-founder and CEO Sam Altman wrote in a social media post this week. Expected to ship later this year, the GPT-5 models will incorporate voice, canvas, search, deep research and more, OpenAI says. Continue reading Sam Altman Reveals Plans to Simplify OpenAI’s Product Line

Google has initiated a flurry of AI activity following the recent collection of Chinese AI releases. The Alphabet company has launched an experimental version of a new flagship AI model, Gemini 2.0 Pro. Its premiere coding and complex questions model is now available in Google AI Studio, Vertex AI and the Gemini Advanced app. The company has also made its general-purpose “workhorse” model, Gemini 2.0 Flash, available in general release via the Gemini API in AI Studio and Vertex. This follows last week’s announcement that Gemini 2.0 Flash is powering the Gemini app for desktop and mobile. Continue reading Google Adds Gemini Flash Thinking to Search, Maps and More

OpenAI has unveiled a new frontier model, OpenAI o3, which it claims can “reason” through challenges involving math, science and computer programming. Available to safety and research testers, it is expected to be available to individuals and businesses this year. OpenAI o3 is said to be over 20 percent more efficient at common programming tasks than its predecessor OpenAI o1 and beat a company scientist on a programming test. Model o3 is part of a broader effort to create AI systems that can reason through complex problems. In late December Google debuted a similar platform, the experimental Gemini 2.0 Flash Thinking Mode. Continue reading OpenAI Previews Two New Reasoning Models: o3 and o3-Mini