Despite the negative financial impact, Nvidia praised DeepSeek’s breakthrough. “DeepSeek is an excellent A.I. advancement and a perfect example of test time scaling,” a company spokesperson told Observer in a statement.

The market reaction proved particularly severe for Nvidia (NASDAQ: NVDA), with shares plummeting and erasing half a trillion in market cap at the time of this writing. To put this staggering figure in perspective,

Short sellers of artificial intelligence-related stocks raked in bumper profits after the smashing debut of low-cost AI models from China's DeepSeek spooked Wall Street, with bets against Nvidia yielding record profits totaling more than $6 billion.

DeepSeek topped the Apple App Store chart and sparked fears the Chinese company was quickly catching up with OpenAI's ChatGPT while costing far less.

the chip maker saw its market value drop by $593 billion, the biggest one-day drop for any listed company on record.

Nvidia spoke positively about DeepSeek’s latest AI model, R1, saying it represented “excellent AI advancement.”