DeepSeek's claims that it cost mere millions to build fanned fears that the huge investments into AI by U.S. firms are unwarranted and a bubble waiting to pop.

Nvidia Corp.’s plunge, fueled by investor concern about Chinese artificial-intelligence startup DeepSeek, erased a record amount of stock-market value from the world’s largest company.

Nvidia's heliocentric position in the AI universe has been taken as gospel truth until now, delivering immense stock gains and serving as a bellwether stock for the AI economy. The big picture: The sudden rise of DeepSeek — whose latest R1 model was publicly launched a week ago — is startling investors with its efficient design and effective results.