DeepSeek jolts AI industry: Why AI's next leap may not come from more data, but more compute at inference
The AI landscape continues to evolve at a rapid pace, with recent developments challenging established paradigms. Early in 2025, Chinese AI lab DeepSeek unveiled a new model that sent shockwaves through the AI industry and resulted in a 17% drop in Nvidia’s stock, along with other stocks related to AI data center demand. This market reaction was widely reported to stem from DeepSeek’s apparent ability to deliver high-performance models at a fraction of the cost of rivals in the U.S., sparking discussion about the implications for AI data centers.