Investing.com — Shares of NVIDIA Corporation (NASDAQ:) fell more than 5% in the 24-hour market after the release of China’s DeepSeek amid growing questions about the need for large-scale capital investment in artificial intelligence That’s what RobinHood data showed Sunday night.
Nvidia fell 5.2% to $135.20, with the stock down 3.2% since Friday, according to Robinhood data.
AI darlings were shaken by the release of DeepSeek R1. DeepSeek R1 is a large-scale language model that claims to rival products from ChatGPT and Meta (NASDAQ:) while using a fraction of the budget.
DeepSeek, which is backed by Chinese quantitative fund High-Flyer, reportedly had access to approximately 50,000 Nvidia H100 AI GPUs, the latest generation of advanced AI chips.
DeepSeek’s release raises concerns that technology companies will need to take a leaner, more capital-efficient approach to AI development and reduce capital expenditures on data centers and advanced AI chips. caused concern.
Analysts at Yardeni Research said that while big tech companies could learn from DeepSeek and design cheaper AI systems, “this may not be a happy development for Nvidia.”
Analysts at JPMorgan argue that concerns about rising AI budgets are “overdone,” saying deep seek efficiency is more likely to be driven by necessity, especially given strict US export controls on China’s chip industry. He added that he was coming.
Six of Wall Street’s so-called “Magnificent Seven” companies, which make up most of Nvidia’s biggest customers, are scheduled to report quarterly results this week and are widely expected to announce increased capital spending on AI development. .
AI giant OpenAI also announced a $500 billion co-investment in U.S. AI infrastructure last week.
