NVIDIA Stock Plunges 17% on Chinese AI Breakthrough
What caused NVIDIA’s stock drop?
NVIDIA’s share price experienced an unprecedented decline on Monday, January 27, 2025, falling 17% and erasing nearly $600 billion in market value.
The dramatic sell-off was triggered by Chinese startup DeepSeek’s announcement of their R1 artificial intelligence (AI) model, which reportedly achieves similar performance to Western models at significantly lower cost.
DeepSeek’s breakthrough has raised questions about future demand for high-performance AI chips, NVIDIA’s core business. The model was developed using stockpiled NVIDIA graphics processing units (GPUs).
This development sent shockwaves through the semiconductor sector, affecting other major players like Advanced Micro Devices…
