DeepSeek, a Chinese artificial intelligence startup, has sparked a global tech stock sell-off that cost Nvidia $600 billion in market value. However, JPMorgan analysts say the company will likely benefit from its AI-driven innovations.
In January, DeepSeek launched its open-source DeepSeek-R1 reasoning models, which performed on par with similar models from OpenAI and Anthropic. The company’s latest model, DeepSeek-V3, released in December, also showed competitive performance against AI models from US-based companies for a lower cost.
This demonstration of cost-efficiency and AI innovation will lead to “strong demand” for higher-performance graphics processing units (GPUs), according to JPMorgan analysts. As a result, Nvidia is likely to unlock new use-cases due to its leadership in advanced AI chips.
Other chipmakers like Broadcom, Marvell, and Micron are also expected to benefit from DeepSeek’s advancements. Intel, however, may see decreased demand for its central processing units (CPUs) amid the shift to accelerated computing.
JPMorgan analysts believe that the broader internet ecosystem will benefit from DeepSeek’s open-source AI model advancements. The improved cost efficiency is expected to accelerate AI development and adoption, leading to increased consumption. Heavy capital expenditures are anticipated by Amazon, Alphabet, and Meta in the medium term.
Meta is likely to benefit from increased open-source model adoption as it builds its next-generation Llama 4 model. Amazon will also gain from providing more open-source AI model options, driving monetization through increased AI demand and usage. Meanwhile, Alphabet will accelerate development and adoption of AI agents due to DeepSeek’s lower training costs.
Google recently made its “most capable” AI model, Gemini 2.0, available to everyone, further highlighting the potential benefits of DeepSeek’s innovations.
Source: https://qz.com/nvidia-stock-market-cap-deepseek-ai-intel-meta-google-1851755910