Nvidia saw its stock price drop by 17% on Monday, resulting in a $600 billion market cap loss—the largest single-day drop in U.S. history. This decline was triggered by growing concerns over competition from Chinese AI lab DeepSeek, which released a more affordable AI model that requires less of Nvidia’s high-cost hardware. DeepSeek’s development raised fears that demand for Nvidia’s GPUs could decrease, as companies might opt for cheaper alternatives.
The sell-off impacted other tech companies reliant on Nvidia’s chips, such as Dell, Oracle, and Super Micro Computer, all experiencing stock declines of at least 8.7%. Broadcom, another major chipmaker, also saw a 17% drop. While some analysts believe the AI sector will continue to demand more computing power, the market reacted with caution following Nvidia’s significant price gains in recent years.
This sudden drop knocked Nvidia from its position as the world’s most valuable public company, with Apple reclaiming the top spot. Despite the volatility, Nvidia remains a key player in the AI chip market, though the future remains uncertain amid growing competition.
