The American giant Nvidia suffered a record blow Monday after Chinese Startup Deepseek disrupted the technology sector – and the rout cost its CEO Jensen Huang more than $20 billion in a single day.
Deepseek said it built its new AI model in just two months for less than $6 million – A fraction of the training costs of its U.S. rivals – and without access to Nvidia’s powerful and expensive computer chips, which are subject to U.S. government export controls.
Nvidia shares plunged as much as 18% as the market was counting on the possibility that the world’s largest AI chip supplier could face less demand as models become more efficient.
The sale wiped $560 billion off NVIDIA’s market capitalization — the largest single-day move by a company in the history of the U.S. stock market, according to Bloomberg. Nvidia already held the record after a 9% surge last September caused $279 billion in value to evaporate.
Huang’s personal net worth also took a major hit, plunging $20.7 billion to $103.7 billion – a drop of more than 16% since the start of the day, according to the Bloomberg Billionaires Index.
Other big AI players were also beaten down in the sell-off. The tech-heavy NASDAQ index was down 3.44% or 687 points as of 1:30 p.m. ET.
Google parent Alphabet, which has invested heavily in AI development under CEO Sundar Pichai, fell 3.27%.
Microsoft, which poured billions into Sam Altman’s Openai, fell 3.36%. Amazon shares were down less than 1%, while Metadata was slightly higher.
Tesla, led by Elon Musk, which has close ties to Nvidia and integrates AI into its product line, fell almost 3%. Musk’s personal fortune fell by about $4 billion to $434 billion, although he still ranks as the world’s richest person.
Constellation Energy, an operator of nuclear power plants, sank more than 19% on concerns that AI could use less energy than necessary in the future. Power generator Vistra Corp fell 21%.