The earnings season for the biggest tech companies has ended, revealing a surprising trend: CEOs of leading tech giants don’t view Chinese AI startup DeepSeek as a threat. The previously little-known project developed a breakthrough AI model, spending just $5.6 million to train it and using less powerful chips than its competitors. However, contrary to investor concerns, most industry leaders saw DeepSeek not as a challenge, but as a source of inspiration and new opportunities for their own developments.
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The earnings season-fueled surge in tech stocks is slowly fading. Almost all of the US tech giants have already released their Q4 2024 results, with the exception of Nvidia, which is scheduled to report on February 26, 2025. The key theme of this reporting period has been the ramping up of AI investments, with Amazon, Google, Meta✴, Microsoft and Apple all showing rapid growth in AI spending.
Amazon’s earnings and revenue numbers beat Wall Street forecasts, but the uncertain outlook for the future still disappointed investors, sending the company’s shares lower. An Evercore analyst called this a correction in expectations, emphasizing that this is not a matter of fundamental problems, but rather a reassessment of the outlook.
Beyond the quarterly earnings report, a Chinese AI startup called DeepSeek, previously unknown to the general public, has attracted unexpected attention. In late January 2025, it unveiled an AI model developed for a record-low $5.6 million. Moreover, it was trained on less powerful chips than those traditionally used by industry leaders. This has become a catalyst for turmoil in the stock market, as investors fear that cheaper computing could reduce AI developments’ dependence on high-performance graphics processing units (GPUs). As a result, shares of Nvidia and other semiconductor makers have fallen sharply.
Before the financial reports were published, some experts were concerned about whether tech giants would slow down their AI investments after realizing DeepSeek’s potential. However, the data presented and assurances from the CEOs of American tech giants showed the opposite. AI remains their strategic priority, and investments in this area continue to grow. As one analyst noted, the numbers speak for themselves — the hypothesis about a possible decline in interest in AI has not been confirmed. On the contrary, the heads of Meta✴, Microsoft, Amazon, and Google not only do not consider DeepSeek a threat, but also show interest in integrating its developments.
Meta✴ CEO Mark Zuckerberg admitted on a quarterly call with investors that the company is still “digesting” what it saw in DeepSeek R1. He noted that the Chinese AI model uses a number of innovative solutions that Meta✴ intends to study in detail. According to him, some approaches may be useful for improving its own AI developments. In addition, DeepSeek’s open source code makes its technology available for study and adaptation in the industry.
Amazon CEO Andy Jassy expressed admiration for some of the training methods used in DeepSeek, adding that AI is a “once-in-a-lifetime business opportunity.” The comment underscores the strategic importance of machine learning technologies for the company’s future. Alphabet CEO Sundar Pichai praised the DeepSeek team, calling them outstanding. However, he noted that he does not see the new Chinese AI as a serious competitor to Google, since the Gemini family of AI models are similarly effective and already demonstrate a high level of optimization.
In turn, Apple CEO Tim Cook said that innovations that improve efficiency are always positive. According to analysts, DeepSeek R1 could play an important role in the future of mobile AI solutions, since its approach allows running AI models directly on smartphones, minimizing dependence on powerful cloud servers. Microsoft CEO Satya Nadella compared DeepSeek’s innovations to traditional computing development cycles, emphasizing that the company is monitoring the project and considers it an example of real innovation.
Amid the general interest in DeepSeek from major tech companies, Tesla and xAI CEO Elon Musk has remained muted. Although he is actively developing his own AI project, his public statements about DeepSeek remain ambiguous. In addition, Musk has recently been focused on his activities at the newly created US Department of Government Efficiency (DOGE). Some of his initiatives have already raised questions from the public and human rights activists, as they are assessed as potentially illegal and unethical.
Independent AI experts are praising DeepSeek’s importance. Evident Insights CEO Alexandra Mousavizadeh called the project a major breakthrough in the field of large language models (LLM), which significantly reduces the cost of generative AI for users. In her opinion, open source code will inevitably lead to other developers studying DeepSeek’s approach and adapting it in their own AI models, confirming that the Chinese startup’s influence on the industry is only just beginning to gain momentum.