Quick wins for a faster PC:
Clear out junk files and repair common Windows errorsFree Scan →Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →Repair Windows errors before they cause bigger problemsFix Now →Nvidia shares fell just under 17% on Monday, January 27, 2025, wiping out about $590 billion in market value. Investors worried that DeepSeek’s lower-cost AI models could weaken expectations for the expensive chips and data centers powering the AI boom. DeepSeek-related concerns helped trigger the selloff, but the one-day drop did not prove that Nvidia’s future demand would decline.
Why did Nvidia lose nearly $600 billion in market value?
The immediate concern was that DeepSeek had shown how AI models might be developed and run with fewer resources than investors expected. If competitive models required less computing power, companies might spend less on advanced chips and the data centers built around them—the growth engine investors had priced into AI-related stocks.
That was a market worry, not a settled finding about the economics of future AI demand. DeepSeek’s models still involved Nvidia hardware, and a more efficient model could also make AI cheaper to deploy and expand its use. The January selloff reflected uncertainty over which effect would matter more.
DeepSeek-V3 launched on January 10, 2025. Reuters reported that DeepSeek researchers said they trained it using Nvidia H800 chips and spent less than $6 million. That figure is the researchers’ reported training expenditure, not an independently established measure of the total cost of building or operating the system. Reuters also reported that DeepSeek’s official WeChat account claimed R1 was 20 to 50 times cheaper to use than OpenAI’s o1, depending on the task. That is a usage-cost comparison, distinct from V3’s reported training cost.
#1 Best Overall
What happened to Nvidia stock and the wider market?
Reuters reported that Nvidia lost about $593 billion in market value as its shares fell just under 17% on January 27. Forbes put the market-capitalization loss at $589 billion. The figures are close estimates of the same dramatic move; describing it as roughly $590 billion avoids implying more precision than the reports support.
At the time, Reuters described the loss as the largest one-day loss in market value for a Wall Street company. Forbes noted that it surpassed Nvidia’s previous record loss of $279 billion on September 3, 2024. That record describes the comparison at the time of the January 2025 selloff; it should not be read as a claim that no later company has since posted a larger loss.
Rank #2
- Ideal for Gifting
- Ideal for a bookworm
- Compact for travelling
| Market measure on January 27, 2025 | Reported move |
|---|---|
| Nvidia | Shares fell just under 17%; market value fell about $593 billion, according to Reuters, or $589 billion, according to Forbes. |
| Philadelphia semiconductor index | Fell 9.2%, its largest percentage decline since March 2020, according to Reuters. |
| Nasdaq Composite | Fell 3.1%, according to the Associated Press. |
| S&P 500 | Fell 1.5%, according to the Associated Press. |
| Dow Jones Industrial Average | Rose 0.7%, according to the Associated Press. |
The declines across the Nasdaq and semiconductor stocks show Nvidia was part of a wider technology selloff, although its drop was much larger than the broad-market indexes. The Dow’s gain also shows the day was not a uniform retreat across every part of the stock market.
How did DeepSeek affect Nvidia stock?
DeepSeek’s R1 model drew attention in the week before the selloff. Reuters reported that by January 27, its assistant had overtaken ChatGPT in downloads in Apple’s U.S. App Store. Investors were weighing that attention alongside claims about lower development or usage costs, and asking whether businesses would need to buy as many top-end accelerators and build as much computing capacity.
Some market participants treated the development as a possible challenge to the AI investment story. Brian Jacobsen, chief economist at Annex Wealth Management, said: “If it’s true that DeepSeek is the proverbial ‘better mousetrap,’ that could disrupt the entire AI narrative that has helped drive the markets over the last two years.” His comment captured a conditional investor concern, not proof that DeepSeek had already displaced Nvidia or reduced industry spending.
Nvidia offered a different interpretation. A company spokesperson told Axios: “DeepSeek is an excellent AI advancement and a perfect example of Test Time Scaling,” and continued: “DeepSeek’s work illustrates how new models can be created using that technique, leveraging widely-available models and compute that is fully export control compliant.” The spokesperson also said inference “requires significant numbers of NVIDIA GPUs and high-performance networking,” referring to the process of running a trained model to answer requests. These are Nvidia’s positions, including its statements about export-control compliance and hardware requirements, rather than independent findings established by the market reports.
Rank #4
Was Nvidia’s loss caused by DeepSeek alone?
The timing and investor commentary link DeepSeek-related concerns to the January 27 selloff, but they do not establish a single cause for every dollar of the decline. The semiconductor index and Nasdaq also fell sharply, indicating that investors were reassessing technology and chip stocks more broadly. The available market accounts describe DeepSeek as a catalyst for concern about AI spending, not as proof that demand for Nvidia products would fall.
Investors also differed on where the durable value in AI would accrue. Daniel Morgan, senior portfolio manager at Synovus Trust Company, said: “The real money in AI is providing the chips for the data centers from the likes of (Nvidia), Advanced Micro Devices (NASDAQ:NVDA) and Broadcom,” expressing the view that infrastructure suppliers could remain central even as models improve. The January 27 share-price move shows how quickly expectations can change; by itself, it does not resolve the debate about long-term AI infrastructure demand.
Free tools Windows power users keep installed
One-click scans. No signup required.
Quick Recap
Best Value
- It can be a gift option
- Comes with secure packaging
- Helpful in various ways
Product prices and availability are accurate as of the date/time indicated and are subject to change. Any price and availability information displayed on Amazon at the time of purchase will apply.
