Shares of global tech giants Nvidia Corp and ASML Holding NV fell after growing buzz about Chinese startup DeepSeek’s latest AI model. It is reportedly capable of delivering performance comparable with chatbots like ChatGPT despite running on less advanced chips.
Nvidia and ASML have been at the forefront of the AI stock boom seen over the past few months. Nvidia designs semiconductors for use in AI, while ASML develops the machines needed to produce high-end chips. The surge in Nvidia’s stock has catapulted its 61-year-old co-founder and chief executive Jensen Huang into the list of the 10 richest people globally.
Shares of Nvidia Corp. were trading at $126.16 on NASDAQ, down 11.54 percent from the previous closing price of $147.22. ASML Holdings NV slipped 11.7 percent to a low of €618.5 in Amsterdam trading on Monday, compared with the previous close of €700.70.
On Monday, DeepSeek’s AI assistant overtook rival ChatGPT to become the top-rated free application available on Apple’s App Store in the United States.
DeepSeek-V3 used Nvidia’s H800 chips for training, which cost less than $6 million, DeepSeek researchers wrote in a paper last month.
AI models from ChatGPIT to DeepSeek require advanced chips to power their training. The US administration, since 2021, has worked to prevent these chips from being exported to China and expand the scope of the sanctions on Chinese companies that are used to train AI models.
The move led many Chinese tech companies to release their own AI models, but most failed to gain attention. However, the DeepSeek AI model is said to have the potential to match ChatGPT and other alternatives in the US tech industry.
DeepSeek’s AI assistant is powered by the company’s V3 model, which, according to its creators, “tops the leaderboard among open-source models and rivals the most advanced closed-source models globally”.
Not much is known about the company behind Hangzhou-based startup DeepSeek, which was founded in 2023 when search engine giant Baidu released the first Chinese AI large-language model.
