Despite a wave of shock caused by the DeepSeek news yesterday that led many tech stocks to plummet, AAPL experienced a rise of 3.25% throughout the day.
Analysts expressed their astonishment at the performance of the Chinese company’s AI model, stating it rivals US chatbots such as ChatGPT, Gemini, and Llama, all developed at a significantly lower cost and designed to operate on less powerful hardware…
DeepSeek’s achievement is ‘unprecedented’
DeepSeek is a chatbot powered by AI developed in China, showcasing benchmarks that reveal its prowess parallel to the leading existing models worldwide. Experts quickly authenticated these results, expressing disbelief that China could achieve this feat at a fraction of the expenses incurred by US models while running on quite modest personal computers.
The magnitude of this accomplishment has been emphasized by many as significant.
The application rapidly ascended to the top of Apple’s App Store.
Triggered a decline in US tech stocks
The primary surprise arose from China’s capability to create such a robust AI model, even as US export regulations limited its procurement of Nvidia GPUs. We reported yesterday that chatbots from OpenAI, Google, and Anthropic utilize over half a million of these graphics processors, while DeepSeek managed to obtain about 50,000 GPUs—yielding comparative results with just 10% of the computational power.
Previously, it was believed there was a direct link between the number of Nvidia processors and AI performance; therefore, evidence that challenged this notion led to a decline in Nvidia shares.
The revelations sent shockwaves through the markets on Monday, positioning Nvidia to potentially lose over $300 billion in market valuation—the most significant decline ever recorded for a single company—while investors reassessed anticipated future investments in AI hardware.
The stock prices of other US AI companies, such as Microsoft and Meta, also experienced declines.
Nonetheless, AAPL rose 3.25%
Amid this downturn, AAPL stock notably rose by 3.25% during the trading day.
Daring Fireball’s John Gruber proposed that a significant rationale could be that it supports Apple’s strategy to maximize AI processing directly on devices. The company’s own AI servers serve as secondary options, with ChatGPT as a fallback.
While there has been skepticism regarding the number of AI capabilities Apple could potentially execute with its own device chips instead of relying on powerful servers, the success of DeepSeek—which runs on standard PCs—indicates that Apple’s method may be far more effective than previously assumed.
A substantial enhancement in the inference abilities of devices with limited RAM strongly implies that Apple’s consumer products will soon be equipped to execute a much wider range of AI functionalities locally.
Whether Gruber’s predictions about the share price hold true remains to be seen, but there’s no denying that Apple’s emphasis on on-device processing has gained considerable credibility.
For more insights on DeepSeek, be sure to check out our latest piece in 9to5Neural.
Photo by John Cameron on Unsplash
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