- Published on February 24, 2025
- In Deep Tech
DeepSeek May Not Hurt Chip Demand, After All
Shortly after the NVIDIA sell-off, Netherlands-based ASML, a chip-making equipment manufacturer, saw shares jump nearly 9%.
- By Sanjana Gupta
In the past month, while AI enthusiasts celebrated the Chinese AI startup DeepSeek’s low-cost R-1 model, which was built with minimal GPUs and capital, the market responded rather brutally. NVIDIA lost nearly $600 billion as its stocks tumbled 17% owing to the efficiency with which the model was built.
More recently, DeepSeek-V3 used just 2,048 NVIDIA H800 GPUs to outperform most open-source models. In contrast, xAI’s Grok-3 was trained on over 100,000 GPUs, yet beats DeepSeek-R1 by just a small margin.
This made the chip market question whether such large numbers of GPUs were even needed to train these models. However, the story has multiple layers, and DeepSeek’s achievements may not hurt the chip demand after all.
Experts speculate that the Chinese compa
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Sanjana Gupta
An information designer by training, Sanjana likes to delve into deep tech and enjoys learning about quantum, space, robotics and chips that build up our world. Outside of work, she likes to spend her time with books, especially those that explore the absurd.
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