AI has fueled Nvidia's extraordinary rise to a $3 trillion market valuation. But on Monday, AI was the cause of a panic among Nvidia investors, sending its shares down almost 17% and wiping out nearly $600 billion in value.
The selloff was triggered by Chinese AI startup DeepSeek, whose latest V3 and R1 AI models appear to rival the best of any U.S. company, while having been trained at a fraction of the cost. Since Nvidia's powerful graphics processing units are one of the biggest costs of developing the most advanced AI models, investors are suddenly, and radically, questioning their assumptions about the AI business.
