U.S. technology companies tumbled in pre-market trading, triggering a global sell-off as Chinese startup DeepSeek stoked concerns about artificial intelligence competitiveness and U.S. leadership in the field.
Chip designer shares NVIDIAone A huge beneficiary of the AI hypedown 9.84% before the opening bell at 05:11 a.m. ET. Dutch chip company ASML and ASM International European trade volume fell by 10.59% and 14.94% respectively, while Asian trade volume fell by 10.59% and 14.94% respectively. Japanese chip-related stocks broadly lower.
DeepSeek launched a free, open-source large language model at the end of December, claiming that it only two months The cost was less than $6 million—much less than what Western counterparts were asking for. Last week, the company released an inference model that also Reportedly performed better than OpenAI’s latest results in numerous third-party tests.
The developments raise questions about the amount of money big tech companies are investing in artificial intelligence models and data centers.
“DeepSeek clearly doesn’t have access to as much computing power as U.S. hyperscalers, but has managed to develop a model that looks extremely competitive,” Raymond James semiconductor analyst Srini Pajjuri said in a note on Monday.
—CNBC’s Lee Ying Shan and Michael Bloom contributed to this article.
This breaking news story is being updated.
