US President Donald Trump has called the rise of Chinese company DeepSeek “a wake-up call” for the US tech industry, after the emergence of its artificial intelligence (AI) model triggered shockwaves on Wall Street.
Shares in major tech firms such as Nvidia fell sharply, with the chip giant losing almost $600bn (£482bn) in market value.
Donald Trump has said that DeepSeek, a Chinese startup, should serve as a “wake-up call” for America’s AI industry, reports Sky News.
The US President aims for US tech companies to dominate the field but recognises the challenge posed by DeepSeek, which claims to have a technical edge over American competitors.
DeepSeek asserts that its AI models are comparable to those of US giants like OpenAI (the creator of ChatGPT) and Google’s Gemini, yet at a much lower cost. This has led to a dip in stock prices, particularly for chipmaker Nvidia, which experienced its largest one-day loss in history, it said.
What has shaken the industry is DeepSeek’s claim that its R1 model was made at a fraction of the cost of its rivals – raising questions about the future of America’s AI dominance and the scale of investments US firms are planning.
DeepSeek has become the most downloaded free app in the US just a week after it was launched.