The rise of Chinese artificial intelligence startup DeepSeek sparked concerns initially in the global tech market and caused a sharp sell-off by wiping $600 billion from Nvidia’s market value. It appears that Nvidia may actually emerge as a winner from this disruption, reveals JPMorgan analysts.

The innovative approach of DeepSeek to AI model training demonstrated that cutting-edge AI can be developed at a fraction of the cost compared to that spent by U.S. tech giants. Its V3 model was trained using Nvidia’s lower-end version H800 chips. The models have performed competitively against those from OpenAI and Anthropic.

JPMorgan suggests that the leadership of Nvidia in advanced AI chips will remain intact. Companies like Amazon, Alphabet (Google’s parent company) and Meta are expected to increase their investment in AI infrastructure.

The shift towards AI-driven accelerated computing could spell trouble for Intel as it relies heavily on CPU sales. The demand for general-purpose CPUs is expected to decline as AI workloads demand more specialized processing power.

The impact of DeepSeek is not limited to the chip industry as its open-source AI models have reinforced the growing trend towards democratized AI development. Meta is expected to benefit from wider adoption. Google and Amazon stand to gain from cost-efficient AI model training equipped with Google potentially accelerating the development of AI agents and applications like NotebookLM and Gemini Advanced.

The broader AI ecosystem is experiencing a shift towards cost-effective and open-source solutions.