DeepSeek's AI Breakthrough in China Marks New Era for Nvidia's Chips

DeepSeek's advancements in AI have highlighted the growing demand for Nvidia's chips in China, despite U.S. export controls. The firm has effectively utilized 2,000 Nvidia H800 chips, compliant with export rules, to compete with global rivals and showcase the potential of advanced AI models.

Nvidia's shares tumbled 17% following concerns over DeepSeek's ability to match competitors using fewer of its chips. Despite this, the Chinese AI firm signifies the continuous need for Nvidia's hardware, projecting increased future demand.

The recent developments underscore ongoing debates about U.S. microchip export controls, intended to slow China's supercomputing capabilities for military and AI developments. Experts emphasize China's continued advances despite these limitations.

DeepSeek has reportedly capitalized on Nvidia's legal chips, showing off a powerful AI team, adept at model creation and inference. This trend indicates Nvidia's sustained relevance in the face of international competition and regulatory challenges.

(With inputs from agencies.)