Deepseek, a Chinese AI startup, was a proverb town of AI when the R1 model was released on Friday. The functionality and accuracy of R1 seems to be a victory in the AI industry as a whole, despite less resources and less power than US counter parts. But it’s not always a good news for anyone.
The huge semiconductor NVIDIA is dressed in DeepSeek’s recent headwinds. According to Yahoo Finance’s data, the chip giant has plummeted 16.9 % from the end of the Friday market to the end of the public market on Monday. NVIDIA lost nearly $ 600 billion from the market capitalization. NVIDIA’s shares were closed for $ 142.62 per share on Friday afternoon. It was closed for $ 118.58 on Monday.
The reason why DeepSeek’s model release affects NVIDIA’s stock is that the R1 offers a clear example of the AI model and does not necessarily require high -end chips or hardware. For tip manufacturers like NVIDIA.
“Deepseek is an excellent progress of AI and a perfect example of scaling for testing time,” said NVIDIA’s spokeswoman in e -mail. “Deepseek’s work indicates how to create a new model using that technology, indicates that it conforms to a completely export control using a widely available model. There are a lot of NVIDIA GPU and a new test time.
All the timing of this is interesting. This is after the former President Joe Biden has further restricted the export of advanced AI chips produced in the United States to a specific country and signed a presidential order with almost a blanket restricted to sending chips to the country. It’s interesting because it’s a week later. Like China, which is the basis of DeepSeek.
At that time, NVIDIA stated that the Presidential Order was “unprecedented, incorrect guidance,” and “derailing innovation and economic growth around the world.”
President Donald Trump has subsequently overturned Videnn’s Presidential Order and signed another presidential order to create a Stargate project, an infrastructure program that invests up to $ 500 billion in the AI data center.
The release of DeepSeek has shown that if the United States dominates its dominance in the global AI market, it is necessary to pay attention to not only chips and hardware.