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

Donald Trump has labeled China's new AI model, DeepSeek, a "wake-up call" for the US tech sector following a significant market value drop for Nvidia, nearing $600 billion.

DeepSeek's emergence triggered a sharp decline in AI-focused company stocks. Nvidia, a major GPU supplier for AI models, suffered the most, experiencing a 16.86% share plunge—a record on Wall Street. Microsoft, Meta Platforms, Alphabet (Google's parent company), and Dell Technologies also saw declines ranging from 2.1% to 8.7%.

Although this claim faces some scrutiny, DeepSeek has raised concerns about the substantial investments US tech giants are making in AI, unsettling investors. Its popularity surged, topping US app download charts, fueled by discussions surrounding its performance.

Sheldon Fernandez, DarwinAI co-founder, commented to CBC News, stating that DeepSeek "performs as well as, and in some cases better than, leading Silicon Valley models, but with a fraction of the resources." He further highlighted the disruption to existing business models, noting that DeepSeek's free access challenges the high valuations of many established companies.

Trump, however, offered a more optimistic perspective, suggesting DeepSeek could be beneficial for the US. He stated (as reported by the BBC) that lower development costs could lead to similar solutions, ultimately benefiting the US. He reiterated the US's continued AI dominance.

Despite DeepSeek's impact, Nvidia remains a $2.90 trillion company. The highly anticipated RTX 5090 and RTX 5080 GPUs are slated for release later this week, generating significant consumer demand.