Chinese AI DeepSeek a 'Wake-Up Call' for U.S. Tech Firms, Donald Trump Says, After Nvidia’s World-Record $600 Billion Loss

The emergence of DeepSeek, a new Chinese AI model, has sent shockwaves through the tech world, prompting concerns and sparking debate. The model's relatively low cost, reportedly trained for just $6 million, has cast doubt on the massive investments being made by American tech giants in AI. This concern, amplified by DeepSeek's rapid rise in popularity, contributed to significant stock market losses, particularly for Nvidia, which experienced a record-breaking drop in market value.

Nvidia, a key player in the GPU market crucial for AI model operation, saw a staggering 16.86% share decline, the largest single-day loss in Wall Street history. Other AI-focused companies, including Microsoft, Meta Platforms, Alphabet (Google's parent company), and Dell Technologies, also experienced substantial drops.

Industry experts, such as Sheldon Fernandez of DarwinAI, highlight DeepSeek's potential to disrupt existing business models. The ability to offer comparable performance at a fraction of the cost challenges the high valuations of established AI companies.

Former President Trump, however, offered a more optimistic perspective, suggesting DeepSeek could ultimately benefit the U.S. by driving down development costs and potentially leading to similar outcomes with reduced expenditure. He maintained his belief in continued U.S. dominance in the AI sector.

Despite the market turmoil, Nvidia remains a major player with a valuation exceeding $2.90 trillion. The company is poised to release its highly anticipated RTX 5090 and RTX 5080 GPUs, generating significant consumer anticipation.