Technology stocks are experiencing significant declines due to rising market panic linked to Deep Seek, a Chinese company that has developed highly efficient AI models. The firm’s R1 model reportedly uses only 2,048 NVIDIA GPUs and costs under $6 million to train, making it potentially 20 to 50 times more efficient than existing models. Although lower costs in AI typically should drive stock prices up, many U.S. tech companies are seen as over-investing in computing infrastructure, raising concerns about their competitiveness in light of these advancements.
Deep Seek, a Chinese LLM firm, has released efficient AI models, triggering market panic and causing significant drops in tech stocks despite lower costs of AI.
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