It was the shot heard in the world.
Deepseek in China shook the technological industry and the stock market at the end of January by publishing a model of AI comparable to Openai O1 which was built at a fraction of its cost.
To be fair, the Initial numbers Bandied on the consumer media were not completely exact.
Instead of costing only $ 5.6 million to train, according to some estimates, the total cost of Deepseek training was closer to $ 1.6 billion.
It is a fairly wide gap, as I suspected very early. However, Deepseek R1 is an impressive feat of technology.
In the days that followed, we talked about how The Jevons paradox Tells us that when something becomes more effective and uses fewer resources, people often end up using more, no less.
This means that we should see an increase in the use of AI.
And we can also expect – even with more effective AI models – it should lead to energy consumption overall, no less.
But so far, we have barely approached the way in which American companies could react to Deepseek with new innovations that are their own.
Let’s do this today because it is linked to my next special broadcast March 17.
Nvidia’s reinvention
More specifically, I mean Nvidia.
As I am sure you remember, Nvidia was particularly affected by the release of Deepseek.
His stock dropped the following Monday …
And the company has lost nearly $ 600 billion in market capitalization.
It was the greatest loss of a day in market history.
When you understand the NVIDIA business model, it is easy to see how it happened.
NVIDIA at present depends strongly on the growth in IA expenditure. In fact, 88% of its income ($ 30.8 billion) come from its data center activity.
In other words, all of Nvidia’s activity is based on a continuous construction of AI.
At the same time, the main Customers of AI as Openai develop their own personalized chips, which reduces their dependence on Nvidia equipment.
It might seem disastrous for the future of Nvidia. But here is the thing …
Nvidia is not new in reinvention.
The CEO of society, Jensen Huang, prosperous. In fact, Nvidia’s ability to rotate on a penny is what helped make it the biggest company in the world.
Only three years ago, during the year 2022, its game segment, which includes fleas for video games and exploitation of cryptography, represented 46% of business sales (12.46 billion dollars).
Today, the revenues of the game segment fell at only 9.4%.
Because once Chatgpt has made everyone realize that artificial intelligence was a force with which Huang had to be reached, Huang pivoted the company in AI.
And with the launch of Deepseek, I predict that another pivot is about to occur.
Huang suggested this during the recent income call of Nvidia when he said: “We did not really exploit an AI of consumers and a research and a certain amount of generative AI of consumers … The next wave is coming. “”
You see, Nvidia’s strength lies in its GPUs, which are incredibly versatile.
Even if the demand for the first iteration of AI slows down, Nvidia’s technology will likely find new uses.
And during the next decade, robotics And autonomous vehicles This could be the next areas where the company collects its current GPUs.
But I think Huang has something bigger planned for the future of Nvidia.
In fact, my team and I have spent the last months investigating what the company could do the next …
And what we discovered is simply remarkable.
It seems that Nvidia has worked behind the scenes with Google on a new IA breakthrough.
And we could hear everything in a major announcement of the “Next-Gen” that Nvidia should be on March 20.
What is this major IA breakthrough?
I believe they are about to announce a new generation AI chip that could completely change the trajectory of artificial intelligence.
I call it QP-Chip.
And just like when Chatgpt ignited the AI boom in 2022…
I believe that the potential NVIDIA chip announcement on March 20 could be the catalyst that again displays the AI actions.
That’s why I will live with Special distribution This Monday, March 17, to break the best way to take advantage of this announcement.
Here is my grip
Before I start to engulf the shares of Nvidia and Google, I want to make something perfectly clear …
I do not believe that the best way to take advantage of this breakthrough is to buy one or the other of the actions of the company.
After all, they are already companies of billions of dollars.
Of course, these stocks could go higher. If Huang announces what I think he will announce, they will probably do it.
But it will take some time.
Instead, I identified a much smaller stock that could be positioned for an even larger movement.
The company that I identified works behind the scenes to help bring this new generation a AI chip. However, it flies completely under the wall street radar today.
In fact, it is about 1/1000th in the size of Nvidia. This means that its stock has much more space to run.
If you are interested in knowing more, simply Click here to book your place For my next special show on March 17.
It’s only three days before the big Nvidia event …
So click here now to book your place today!
Greetings,
Ian King
Chief strategist, Banyan Hill Publishing
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