HomeTechNvidia's Unexpected Encounter Leaves a Lasting Mark

Nvidia’s Unexpected Encounter Leaves a Lasting Mark

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Nvidia responds to being hit in the face with a shovel, breaking its silence on the record-breaking single-day loss and DeepSeek’s AI advancements that sent shockwaves across the industry.

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Nvidia Responds to Getting Hit in Face With Shovel

Nvidia has broken its silence following the company setting a new record for the biggest single-day loss of any company in history. The tech sector is on track for a ‘$1 trillion wipeout’ as investors struggle to come to terms with the latest developments.

A Chinese startup, DeepSeek, has made headlines by claiming that its AI chatbot can rival the best OpenAI has to offer at a tiny fraction of the cost. What’s more, DeepSeek‘s announcement sent shockwaves across the industry, sparking a global selloff.

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Nvidia develops and sells the chips AI companies use to train their increasingly compute-intensive models. The company chose not to engage in a heated debate despite the startup’s stock price taking a hit. Instead, an Nvidia spokesperson offered measured remarks on the situation.

DeepSeek is an excellent AI advancement and a perfect example of Test Time Scaling,’ the spokesperson said. ‘Their work illustrates how new models can be created using that technique, leveraging widely-available models and compute that is fully export control compliant.’

The statement is striking given the massive amount at stake. The US government has banned the export of Nvidia‘s H100 AI chip, including a capped version called the H800, which DeepSeek reportedly uses.

The situation highlights widespread skepticism over soaring costs in the AI industry. Some analysts are hopeful that DeepSeek‘s advancements could clear a path to profitability for the sector. However, others are more cautious, citing concerns about massive overspending and the lack of clarity on when generative AI will break even.

Nvidia‘s response has yet to calm investors. The company’s shares remain down, cementing a catastrophic 16 percent loss. As the dust settles, investors are forced to re-evaluate their assumptions about the AI sector.

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