this post was submitted on 27 Jan 2025

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Nvidia falls 14% in premarket trading as China's DeepSeek triggers global tech sell-off (www.cnbc.com)

submitted 5 days ago by [email protected] to c/[email protected]

346 comments fedilink hide all child comments

cross-posted from: https://lemm.ee/post/53805638

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[–] [email protected] 69 points 4 days ago (42 children)

I think this prompted investors to ask "where's the ROI?".

Current AI investment hype isn't based on anything tangible. At least the amount of investment isn't, it is absurd to think that trillion dollars that was put in the space already, even before that Softbanks deal is going to be returned. The models still hallucinate as it is inherent to the architecture, we are nowhere near replacing the workers but we got chatbots that "when they work sometimes, then they are kind of good?" and mediocre off-putting pictures. Is there any value? Sure, it's not NFTs. But the correction might be brutal.

Interestingly enough, DeepSeek's model is released just before Q4 earning's call season, so we will see if it has a compounding effect with another statement from big players that they burned massive amount of compute and USD only to get milquetoast improvements and get owned by a small Chinese startup that allegedly can do all that for 5 mil.

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[–] [email protected] 3 points 4 days ago

You love to see it!

[–] [email protected] 25 points 4 days ago

Nice. Fuck you Nvidia.

[–] [email protected] 12 points 4 days ago (1 children)

It's fun seeing these companies take a hit and the bubble deflate, but long term won't this just make AI a more alluring form of enshittification to a wider audience?

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[–] [email protected] 37 points 4 days ago (27 children)

It still rely on nvidia hardware why would it trigger a sell-off? Also why all media are picking up this news? I smell something fishy here...

[–] [email protected] 10 points 4 days ago

A year ago the price was $62, now after the fall it is $118. Stocks are volatile, what else is new? Pretty much non-news if you ask me.

[–] [email protected] 33 points 4 days ago (1 children)

The way I understood it, it's much more efficient so it should require less hardware.

Nvidia will sell that hardware, an obscene amount of it, and line will go up. But it will go up slower than nvidia expected because anything other than infinite and always accelerating growth means you're not good at business.

[–] [email protected] 7 points 4 days ago

Back in the day, that would tell me to buy green.

Of course, that was also long enough ago that you could just swap money from green to red every new staggered product cycle.

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[–] [email protected] 39 points 4 days ago (3 children)

Hm even with DeepSeek being more efficient, wouldn't that just mean the rich corps throw the same amount of hardware at it to achieve a better result?

In the end I'm not convinced this would even reduce hardware demand. It's funny that this of all things deflates part of the bubble.

[–] [email protected] 4 points 4 days ago* (last edited 4 days ago)

It will probably not reduce demand. But it will for sure make it impossible to sell insanely overpriced hardware. Now I'm looking forward to buying a PC with a Chinese open source RISCV CPU and GPU. Bye bye Intel, AMD, ARM and Nvidia.

[–] [email protected] 51 points 4 days ago* (last edited 4 days ago) (2 children)

Hm even with DeepSeek being more efficient, wouldn’t that just mean the rich corps throw the same amount of hardware at it to achieve a better result?

Only up to the point where the AI models yield value (which is already heavily speculative). If nothing else, DeepSeek makes Altman's plan for $1T in new data-centers look like overkill.

The revelation that you can get 100x gains by optimizing your code rather than throwing endless compute at your model means the value of graphics cards goes down relative to the value of PhD-tier developers. Why burn through a hundred warehouses full of cards to do what a university mathematics department can deliver in half the time?

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[–] [email protected] 15 points 4 days ago

Maybe but it also means that if a company needs a datacenter with 1000 gpu's to do it's AI tasks demand, it will now buy 500.

Next year it might need more but then AMD could have better gpu's.

[–] [email protected] 15 points 4 days ago (2 children)

So, I get that the hardware is needed for training the models and that's why the stock price fell. But it's also required to run the models, and this news is only going to increase the supply of AI services. It seems to me that this isn't a big threat to the companies that sell AI hardware.

[–] [email protected] 3 points 4 days ago

The thing is that they can no longer sell insanely overpriced hardware. The VC fucktards and coin bros begin to understand they're being scamed. And that murdering competition from China is around the corner. All this is very good news for consumers.

[–] [email protected] 2 points 4 days ago

Agree, but the market doesn’t think rationally.

Better access to software is good for hardware companies. Nvidia is still the best company when it comes to this kind of computing hardware.

[–] [email protected] 38 points 4 days ago (1 children)

Finally a proper good open source model as all tech should be

[–] [email protected] 3 points 4 days ago

Nice. Happy news today

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