Perhaps no stock was more profoundly affected by the news from DeepSeek than Nvidia (NVDA -3.67%). In a sense, DeepSeek validated its dominance by announcing its H800 accelerators

Here’s what you need to know about DeepSeek, the Chinese AI startup that rattled markets as its app dethroned OpenAI's as the most-downloaded free app in the U.S. on Apple.

Some AI researchers hailed DeepSeek’s R1 as a breakthrough on the same level as DeepMind’s AlphaZero, a 2017 model that became superhuman at the board games Chess and Go by purely playing against itself and improving, rather than observing any human games.

DeepSeek stunned the tech world with the release of its R1 "reasoning" model, matching or exceeding OpenAI's reasoning model for a fraction of the cost.

The startup DeepSeek was founded in 2023 in Hangzhou, China and released its first AI large language model later that year. Its CEO Liang Wenfeng previously co-founded one of China’s top hedge funds, High-Flyer, which focuses on AI-driven quantitative trading.

DeepSeek has launched an AI model that was reportedly developed with significantly less computational power than traditional methods. Shares of Nvidia are under pressure amid concerns that DeepSeek's methods may undermine demand for its high-performance GPUs.

Stocks rose Friday as Apple led a broad rally following a strong investor reaction to its quarterly earnings report and the market closes out a whirlwind week highlighted by Nvidia’s record-breaking losses in reaction to China’s DeepSeek cheaper AI model and a flurry of earnings reports.

Nvidia (NASDAQ:NVDA) closed ~5% lower this week to end January with an ~11% slide after Chinese startup DeepSeek’s (DEEPSEEK) low-cost AI model wiped off more than $500B in market capitalization from the Santa Clara,