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DeepSeek’s cost-efficient AI training advancements rocked tech markets on Monday and came in just in time to give U.S. tech investors a reason to pay close attention to earnings season. Tech earnings will kick off on Wednesday, with earnings coming from Microsoft, Meta, and Tesla, followed by Apple on Thursday. DeepSeek released a cheaper AI model called R1 last week that outshined OpenAI’s latest model in many third-party tests. The Hangzhou-based AI company launched a free, open-source model in December that revealed it took only two months and less than $6 million to build.  The company’s news drew panic on Wall Street due to the potential implications of cheaper AI models coming sooner rather than later. The tech industry plummeted after the news, with the S&P 500 dropping 1.46% and the Nasdaq tanking by roughly 2.3% on Monday. Tech companies to release earnings amid market shockwave from DeepSeek Big week for tech earnings, and most analysts’ questions will likely focus on the impact of DeepSeeK. pic.twitter.com/yMdlZQtrR5 — The Transcript (@TheTranscript_) January 27, 2025 Nvidia plummeted over 17% since Monday, a drop that was last seen during the early days of the Covid pandemic in March 2020. The drop in Nvidia’s stock price wiped out $600 billion in its market cap, the biggest 24-hour loss ever for a U.S. company. Some of the big tech companies that spend billions of dollars on AI infrastructure, and mostly for Nvidia’s GPUs, will release quarterly results on Wednesday, including Microsoft, Meta, and Tesla. Apple will follow on Thursday, while Alphabet and Amazon will release next week. An analyst at Stifel believes the main attention to tech earnings this week with regard to DeepSeek will be more about costs rather than about revenue. The sheer efficiency of DeepSeek’s pre and post-training framework (if true) raises…

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Filed under: News - @ January 28, 2025 5:27 pm