Could DeepSeek’s AI gains be good news for all AI players?

After China’s DeepSeek released a new artificial intelligence (AI) model, investors weigh whether US tech companies can keep up, sending AI-related stocks like Nvidia (NVDA), Broadcom (AVGO), and Taiwan Semiconductor Manufacturing Company (TSM) tumbling.

Moor Insights & Strategy founder, CEO, and chief analyst Patrick Moorhead joins Julie Hyman and Josh Lipton on Market Domination. He shares his view that while DeepSeek has made an important advancement in inference, the market may be too worried about what it means for US AI companies.

“I don’t think this is some Chinese psyop,” Moorhead explains. “I spent my weekend reading white papers and going through the details, and while I am not a data scientist, I do believe that what’s clear to me is they used different techniques than the other model makers are doing, where they were able to parse or train maybe 5% of the data. That’s like a 95% reduction.”

He adds, “When you actually run one of these applications called inference, they did that with an exceptional amount of optimization.”

Despite finding DeepSeek’s model impressive, Moorhead thinks the market response is “a gigantic overreaction.”

“I think the market overall should be going crazy because [this is the] uplift of what we were looking for [from AI],” he says, adding that the investors’ focus should be on the progress in inference.

Watch the video above to learn more about Moorhead’s read on the impact of DeepSeek’s new model on Nvidia and other AI players.

To watch more expert insights and analysis on the latest market action, check out more Market Domination here.

This post was written by Naomi Buchanan.