Jensen Huang Loses $20B In Wealth: How DeepSeek Hit Nvidia Stock And World's Richest People

Nvidia Corp. co-founder and CEO Jensen Huang saw his net worth plummet by $20.1 billion on Monday, as a tech-led selloff tied to Chinese artificial intelligence developer DeepSeek sent major indices plunging. Huang's fortune fell by 20%, according to the Bloomberg Billionaires Index, as Nvidia's stock price tumbled 17% to close at $118.58. This was the company's worst day on the market since March 2020, during the early days of the Covid-19 pandemic.

The sell-off was sparked by concerns that DeepSeek, a Hangzhou-based AI developer, is presenting increased competition in the global AI battle. DeepSeek's free, open-source large language model, DeepSeek R1, was released last week and has since topped download charts worldwide. The model's development cost just $5.6 million and was trained using less powerful and fewer chips than those used by Western AI companies like OpenAI and Anthropic. This raised questions about the necessity of high capital spending on AI development and the demand for high-end GPUs, which Nvidia dominates in the U.S. market.

The sudden excitement around DeepSeek pushed its app past OpenAI's ChatGPT as the most-downloaded free app in the U.S. on Apple's app store, leading to a frenzy of selling in U.S. tech stocks. This, in turn, dragged down the net worth of some of the world's top billionaires, including Huang and Oracle co-founder Larry Ellison, who lost $22.6 billion in a single day.

Nvidia's stock price plummeted 17% on Monday, wiping out approximately $589 billion in market cap, the largest single-day loss in U.S. corporate history. The sell-off also extended to other tech and semiconductor companies, with Broadcom falling 17% and pulling its market cap down by $200 billion. Data center companies reliant on Nvidia's GPUs for their hardware sales, such as Dell and Oracle, also experienced sharp declines of at least 5.8%.

The AI-fueled stock surge of the past two years has made companies like Nvidia central to market confidence. Nvidia's shares soared 239% in 2023 alone, driven by demand from tech giants like Alphabet, Meta, and Amazon. However, the latest development comes amid growing tensions in the AI race between the U.S. and China, with DeepSeek's success raising questions about the sustainability of high AI-related spending and the demand for Nvidia's GPUs.




In conclusion, DeepSeek's emergence has had a significant impact on the AI industry, investors, and the world's richest people. The company's cost-effective approach to AI development has raised questions about the necessity of high capital spending and the demand for high-end GPUs. As a result, investors should closely monitor the AI hardware market and consider diversifying their portfolios to include companies that focus on efficiency and cost-effectiveness. Additionally, investors should stay informed about regulatory changes and the broader AI landscape to make informed decisions about their investments.