he Chinese AI startup DeepSeek has gained a lot of popularity recently due to their recent release of the DeepSeek R1 model which is powered by artificial
intelligence technology. This, and the impressive capabilities of the model have managed to make DeepSeek the most popular app in the Apple App Store surpassing OpenAI ChatGPT which has been at the top for some time.
According to Yahoo Finance Data, as DeepSeek became popular, the giant semiconductor experienced a drop in Nvidia's market value of about 17%. So in this Nvidia stock market value drop the chip maker has lost about 600 $ billion in its market cap.
Friday afternoon, Nvidia’s stock closed at $142.62 per share, while Monday recorded a much lower price of $118.58 per share.
As some sources state, DeepSeek managed to impact the Nvidia stock price due to the fact that the AI startup demonstrated that artificial intelligence models don’t really need high-price chips and hardware to provide impressive capabilities. This fact is not actually great news for chip makers, especially Nvidia which is the world leader in artificial intelligence computing and the most valuable company.
“DeepSeek’s work illustrates how new models can be created using that technique, leveraging widely-available models and compute that is fully export control compliant. Inference requires significant numbers of Nvidia GPUs and high-performance networking. We now have three scaling laws: pre-training and post-training, which continue, and new test-time scaling.”, as stated by a Nvidia spokesperson for TechCrunch.
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It should be mentioned that is impressive how DeepSeek gained popularity in the U.S. territory as not long ago, the Biden government approved an executive order that demanded additional restrictions over the export of U.S artificial intelligence chips to various countries such as China. Even if DeepSeek is based in China, the AI startup has managed to create an advanced artificial intelligence model that has a high potential to overcome some of the most advanced AI models such as Perplexity or ChatGPT.
After Donald Trump became the U.S. President, he changed Biden’s executive order to implement a new idea, the Stargate Project, which represents a program that aims to invest about $500 into various artificial intelligence data centers.
Stay tuned to see if Nvidia will be more impacted by DeepSeek's recent popularity!
By
Adam Brown
•
January 28, 2025 10:10 AM
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