Monday, January 27th 2025
Tech Stocks Brace for a DeepSeek Haircut, NVIDIA Down 12% in Pre-market Trading
The DeepSeek open-source large language model from China has been the hottest topic in the AI industry over the weekend. The model promises a leap in performance over OpenAI and Meta, and can be accelerated by far less complex hardware. The AI enthusiast community has been able to get it to run on much less complex accelerators such as the M4 SoCs of Mac minis, and gaming GPUs. The model could cause companies to reassess their AI strategy completely, perhaps pulling them away from big cloud companies, toward local acceleration on cheaper hardware; and cloud companies themselves would want to reconsider their orders of AI GPUs in the short-to-medium term.
All this puts the supply chain of AI acceleration hardware in a bit of a spot. The NVIDIA stock is down 12 percent in pre-market trading as of this writing. Microsoft and Meta Platforms also faced a cut, shedding over 3% each. Alphabet lost 3% and Apple 1.5%. Microsoft, Meta and Apple are slated to post their quarterly earnings this week. Companies within NVIDIA's supply chain, such as ASML and TSMC, also saw drops, with ASML and ASM International losing 10-14% in European pre-trading.
Sources:
LiveMint, The Kobeissi Letter
All this puts the supply chain of AI acceleration hardware in a bit of a spot. The NVIDIA stock is down 12 percent in pre-market trading as of this writing. Microsoft and Meta Platforms also faced a cut, shedding over 3% each. Alphabet lost 3% and Apple 1.5%. Microsoft, Meta and Apple are slated to post their quarterly earnings this week. Companies within NVIDIA's supply chain, such as ASML and TSMC, also saw drops, with ASML and ASM International losing 10-14% in European pre-trading.
102 Comments on Tech Stocks Brace for a DeepSeek Haircut, NVIDIA Down 12% in Pre-market Trading
DevQuasar/deepseek-ai.DeepSeek-R1-Distill-Llama-8B-GGUF
huggingface.co/DevQuasar/deepseek-ai.DeepSeek-R1-Distill-Llama-8B-GGUF
Was fast and did solve a lot of problems what was a real struggle for Phi-4 and Llama 3.3.
But the Qwen 32B Q4_K_M was really slow for some reason.
simonwillison.net/tags/llm-pricing/
I love that I was right about this.
BURN BABY BURN
The minute Elon badmouthed the deal in May 2023, the Banks knew they were eff'd. When the Twitter purchase finally completed in August there was still Elon suing to try to stop the Twitter deal. Even Elon didn't want to take over Twitter.
By November the court cases were done and Elon was solidly in control of the company. And now the debt (which was negotiated and signed and created back in April) was seen as worthless to the public.
Banks are now trying to sell the debt before it gets worse for them. Better to lose half (or more) on the debt than hope for Twitter to rebound.
-13% loss means billion Dollars erased
But yeah, -13% means that NVidia lost about 4 or 5 Intel's this morning.
And both will remain important, but yes - both are overvalued as of now.
NVDA down almost 14%
TSMC down almost 13%
AVGO down almost 15%
AMD down almost 6%
Intel down less than 0.5%
Really shows what companies are viewed as invested in AI and by how much. Intel not so much or at all.
It effects those who hold the shares.
This is why you see headlines like this:
finviz.com/map.ashx?t=sec
-15.43%
-15.57%
-15.71% falling like a rock
On the bright side, the Euro seems to be recovering a bit ground.