Financial reports and market data from reputable financial news outlets

Nvidia Shares Plummet Over 12%, Set for $420 Billion Loss Amid DeepSeek's AI Impact

Jan 27, 2025, 10:59 AM

Nvidia Corp.'s shares experienced a significant decline of over 12% in premarket trading, reflecting broader concerns about the impact of China's DeepSeek on the global technology sector. DeepSeek, a Chinese AI startup, has introduced a large-language model that reportedly rivals the performance of leading US models like ChatGPT, but at a fraction of the cost and development time. This development has sparked a sell-off in tech stocks, with major companies such as Microsoft, Meta, and Google also seeing declines in their share prices. The emergence of DeepSeek has raised questions about the sustainability of US dominance in AI and the necessity of the substantial investments made by American tech giants in AI infrastructure. Nvidia's market cap loss is projected to exceed $420 billion, marking the largest single-day drop in history. DeepSeek's model was developed in just two months at a cost under $6 million.