Nvidia's stock experienced a significant decrease, resulting in a loss of $595 billion in market value, equivalent to the combined value of PepsiCo, McDonald's, Starbucks, and Target.
A Chinese newcomer, DeepSeek, claimed to have created a large language model that rivals ChatGPT in performance but with lower computational requirements, challenging Nvidia's market dominance.
Despite the initial decline, Nvidia's stock recovered nearly 9% following its largest drop since the COVID-19 crash in 2020.
Analysts suggest that while DeepSeek's emergence introduces uncertainty, the AI sector's overall momentum remains robust, as Brian Colello from Morningstar noted.