French startup Mistral has launched Europe’s first AI reasoning model, positioning itself as a key contender against AI giants in the U.S. and China.
Mistral’s latest offering marks a milestone for European innovation in artificial intelligence. Backed by French President Emmanuel Macron, the company has embraced an open-source approach that sets it apart from major U.S. players like OpenAI and Google. Unlike these firms, Mistral has released some of its advanced models to the public, a move seen as a strategic effort to promote transparency and collaboration.
Despite currently trailing behind in revenue and market share, Mistral is widely regarded as Europe’s strongest candidate to rival leading AI firms globally.
The company has launched two new models: Magistral Small and Magistral Medium. Magistral Small is open-sourced. Magistral Medium targets business clients. Both belong to a new generation of reasoning models. These models use chain-of-thought techniques. This method helps AI break down problems step by step, mimicking human-like reasoning.
As AI development hits the limits of simply scaling up large language models with more data and computational power, reasoning models present a new direction for advancement.
“The best human thinking isn’t linear — it weaves through logic, insight, uncertainty, and discovery,” Mistral stated. “Reasoning language models have enabled us to augment and delegate complex thinking and deep understanding to AI.”
OpenAI launched the first reasoning models last year. Google followed shortly after. China’s DeepSeek also entered the scene with low-cost, open-source models. Meta has open-source AI, too. However, it hasn’t released a standalone reasoning model yet. Its latest version is said to include reasoning features.
Mistral’s Magistral Small model is now available for download on Hugging Face. It supports reasoning in multiple languages, including English, French, Spanish, Arabic, and simplified Chinese.
Mistral’s open-source strategy mirrors the approach taken by several Chinese firms like Alibaba and DeepSeek, which have used openness to demonstrate technological strength. In contrast, American companies mostly keep their high-end models proprietary.
With a recent valuation of $6.2 billion, Mistral may benefit from the industry’s gradual shift away from pure scale and toward smarter, more efficient models. This changing landscape could open doors for the French company to close the gap with better-funded competitors.