Just a month ago, few people in the U.S. knew about the Chinese AI start-up, DeepSeek. Now, its advancements have shaken up the financial world, causing massive losses for some major companies.
DeepSeek recently announced that its AI system can compete with top-notch chatbots from Google and OpenAI at a much lower cost. This news made investors rethink the high valuations of many American tech firms.
The impact was swift. The S&P 500 dropped by 1.5 percent, the Nasdaq fell by 3 percent, and Nvidia, known for its impressive AI chips, saw a staggering 17 percent decline, losing around $600 billion in market value.
Jason Karaian, our deputy business editor, described DeepSeek’s rise as a wake-up call for those who thought the AI competition already had clear leaders.
Meanwhile, DeepSeek’s chatbot became the most downloaded free app in the U.S. App Store. This sparked discussions about the effects of U.S. trade restrictions on China, which have pushed researchers there to innovate. Some experts now question whether U.S. companies can keep up in the AI game.
DeepSeek is now a name to watch in the industry, and its story is just beginning.
