Nvidia Loses Nearly $600 Billion As AI Rival DeepSeek Shakes Up AI Market

Nvidia’s shares dropped 17% on Monday, losing around $600 billion in market value, after DeepSeek gained popularity with its latest AI model and reached the top spot on Apple’s App Store. The loss has been described as the largest single-day market value loss for a company in history.

According to The New York Times, the plunge is related to the Chinese startup’s success in proving it can build and train advanced AI models without relying on Nvidia’s Graphics Processing Units (GPUs), challenging the American company’s leadership in the market.

Last year, Nvidia’s shares soared as it capitalized on the AI wave, developing hardware for cutting-edge AI technology and climbing to the top ranks among the world’s most powerful companies. While its shares had already declined by August after its impressive growth in the previous months, the recent drop has been particularly alarming—marking its worst day since the pandemic-driven sell-off in 2020.

According to Forbes, this loss represents “the biggest market loss in history” for a company in a single day, as Nvidia lost a total of $589 billion in market capitalization yesterday. Nvidia lost its position as the most valuable company in the world, with its valuation dropping from $3.5 trillion to $2.9 trillion, falling below Microsoft and Apple.

Nvidia controls 90% of the AI chip market, powering OpenAI’s ChatGPT since 2022, and increasing its revenue above 200% in the past few years, but now DeepSeek’s breakthrough has raised concerns about the future of the company.

Just a few days ago, Nvidia’s CEO Jensen Huang introduced new chips and technologies at the Consumer Electronics Show (CES) in Las Vegas.