Nvidia Loses $600B as Chinese AI Startup DeepSeek Rattles Tech Market

NEW YORK, Jan 28 — Nvidia saw its market value drop nearly $600 billion, leading a sell-off in tech stocks after the emergence of DeepSeek, a Chinese startup that developed a low-cost generative AI model. The chatbot, which rivals U.S. AI leaders, was created for just $5.6 million—pennies compared to the billions U.S. companies have invested in AI.

Shares in Nvidia, a key supplier of semiconductors for AI, fell nearly 17% on Wall Street, triggering a broader tech market decline, with the Nasdaq losing more than 3%. The rise of DeepSeek has raised concerns about China’s challenge to U.S. dominance in AI.

DeepSeek’s chatbot, which topped the Apple US App Store’s free app charts, has prompted speculation on whether China can outpace the U.S. in developing AI more quickly and cost-effectively. However, skepticism remains about the claims made by the Chinese startup.

In addition to Nvidia, shares in other tech companies like Broadcom and ASML also saw significant drops. The volatility in the tech sector came amid a broader market reaction to potential shifts in global AI competition.

As AI giants Meta and Microsoft are set to report earnings this week, attention remains on how U.S. companies will respond to China’s rising presence in the AI race.