Wall Street Trembles: Chinese AI DeepSeek Threatens Tech Giants by Overtaking ChatGPT

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Silicon Valley didn't expect it. On Monday, January 27, the DeepSeek application dethroned ChatGPT on the Apple App Store in the United States, triggering a shockwave on the financial markets. The semiconductor giant Nvidia lost nearly 17% of its value in a single session, evaporating $589 billion in market capitalization. Unprecedented in the recent history of Wall Street.

A low-cost revolution that challenges the American giants

DeepSeek is shaking up all the codes established by the American leaders in AI. The Chinese startup claims to have developed its R1 model for only $6 million, while OpenAI has invested over $100 million in GPT-4. Even more impressive, the company reportedly used only 2,000 specialized chips from Nvidia, compared to 16,000 for its American competitors.

This technical feat calls into question the strategy of tech giants, which are banking on massive investments in data centers. Microsoft and its partners are planning to inject $500 billion into the Stargate project, of which $100 billion would be earmarked for the purchase of Nvidia components. An approach that investors are starting to seriously question.

A domino effect on the entire technology sector

The DeepSeek wave spares no one. The semiconductor sector is taking the full brunt of this challenge to the dominant model. Broadcom collapses by 17%, AMD loses 6.37%, while Micron and Marvell Technology fall by 11.71% and 19.10% respectively.

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The tech giants are not left out. Google (Alphabet) and Microsoft, which have invested heavily in AI, have seen their shares fall by more than 3%. Even the energy sector is suffering, with DeepSeek’s reduced computing power requirements causing data center stocks to plummet. Constellation Energy (-20.85%), Vistra Corp (-28.27%) and GE Vernova (-21.52%) are paying the price.

A new geopolitical situation in the race for AI

The emergence of DeepSeek is a game changer in the global battle for artificial intelligence. Chinese startup proves it's possible to develop high-performance models despite U.S. trade restrictions on advanced semiconductors.Its meteoric rise in the US, on Apple’s App Store, also shows that users are ready to adopt solutions from China.

This breakthrough comes as the Trump administration has just announced a colossal $500 billion plan to develop American AI infrastructure. But DeepSeek’sshow of force could well force Washington to review its strategy. The arms race in AI may not be played out solely on the terrain of raw power.

Karl Healing, an analyst at LBBW, sums it up: “ This is a knee-jerk reaction to something new. The market shoots first and asks questions later. » The VIX index, a barometer of investor fear, jumped 20.54%, reflecting the general nervousness.

• DeepSeek Becomes Most Downloaded AI App in US, Surpassing ChatGPT
• Nvidia Loses $589 Billion in Stock Market After Report That DeepSeek Requires 8 Times Fewer Chips
• The Business Model of US AI Giants Is Being Questioned as They Plan to Invest $500 Billion in Infrastructure

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