Translation:They are not stupid.
Good question. I had always understood QIp as "stupid" in the sense of "cannot think well" -- an attribute of people. So accepted translations here are "they, he, she".
I'm not sure whether QIp can also mean "stupid" as in "senseless" (a stupid question). If so, "it is not stupid" should also work.
Or if we use "it" for a child (which some English speakers accept though others reject this).
I'll add "it".
Context can go a long way towards understanding. Either of the sentences is unlikely to be said without more conversation that would make one make sense and the other to seem odd. I think you will also find that most speakers would have a slight pause between the two syllables when they are separate words. None the less, it is possible for it not to be clear and for the listener to respond by asking QIp be''e' pagh QIpbe' ghaH?
It's the whole -be' suffix that makes it negative.
An explanation is given in the Tips & Notes, but I know it’s a lot of new information and some details are bound to be difficult to understand or slip through the memory. However, since Duolingo has hidden the Tips & Notes I want to make sure you know about them and where to find them. If you have not been reading the Tips & Notes, I would like to ask that you review those.
If you are doing the course on iOS or Android, you cannot currently access the Tips & Notes through the app. To access the Tips & Notes, you will have to access the course using a web browser at https://www.duolingo.com/. You can still do it on your mobile device, but you will have to use the web browser instead of the app (or you can do it from a computer). When you click on a Skill, it will expand to reveal a Start button, a key, and a light bulb.
If you click on the light bulb it will reveal the Tips & Notes and give you a detailed explanation of the grammar that is introduced in that Skill. Duolingo is testing a new pattern where instead of a light bulb, there is a large button that says "Tips", so some people might see that instead. If you are on the web interface and see neither a lightbulb, nor a "Tips" button, then that specific Skill probably doesn't have any Tips & Notes.
If you have questions after reading the Tips & Notes for any Skills, then please return to the forum to ask your question, explaining what you didn’t understand or what seems contradictory to you.