Shares of Nvidia rose in Europe on Wednesday, signalling a potential recovery after a sharp decline earlier in the week. The company, a key player in the AI sector, saw its Frankfurt-listed shares increase by 2%, following an 8.9% gain on Wall Street the previous day. This bounce came after a steep drop in Nvidia’s market value on Monday, triggered by the emergence of China’s DeepSeek AI tool, which posed a challenge to established players like OpenAI’s ChatGPT.
The decline in Nvidia’s stock earlier in the week saw the company lose nearly $600 billion in market value, marking the largest single-day loss in history for any company. However, markets showed signs of stabilising on Wednesday, bolstered by a surge in shares of ASML, the Dutch company that manufactures tools for chip production. ASML’s 11% jump helped lift European tech stocks, with chipmakers BE Semiconductor and ASM International also posting solid gains.
Investors seemed to regain confidence, with some believing that DeepSeek’s advancements might not disrupt the broader AI market. According to market strategist Chris Weston, the innovation from DeepSeek could even generate new demand for Nvidia’s GPUs, which are critical for AI applications. Meanwhile, Microsoft and OpenAI are investigating whether DeepSeek improperly used data from ChatGPT’s technology.
As markets remain volatile, investors are now looking ahead to earnings reports from major tech giants like Nvidia, Apple, and Microsoft, which could provide more clarity on the sector’s outlook. Despite ongoing uncertainties, the overall sentiment in the tech sector appeared more positive by midweek.
Alibaba launched a new version of its Qwen 2.5 AI model on Wednesday, claiming it outperforms competitors like DeepSeek-V3, GPT-4, and Llama-3.1-405B. The release, timed on the first day of the Lunar New Year when most Chinese workers are on holiday, highlights the growing pressure from DeepSeek’s rapid rise in the AI sector. The Chinese tech giant’s announcement emphasised that Qwen 2.5-Max delivers better performance across various AI benchmarks compared to some of the top models from OpenAI and Meta.
DeepSeek’s recent success, particularly after its January releases of the DeepSeek-V3 and R1 models, has shaken the AI market, including both international competitors and Chinese firms. The company’s low development and usage costs have raised concerns about the sustainability of large AI investments from US tech giants. The competition within China has intensified, with Alibaba’s Qwen 2.5-Max release and ByteDance’s update to its AI model shortly after DeepSeek’s R1 release, signalling a rapid response to the new market dynamics.
DeepSeek’s previous model, V2, had already disrupted the market last year, triggering a price war with Chinese firms slashing prices on AI models. Alibaba and other major tech companies, including Baidu and Tencent, had to follow suit, offering significantly cheaper options. Despite this, DeepSeek’s founder, Liang Wenfeng, has expressed that his company is focused on achieving Artificial General Intelligence (AGI) rather than competing on price, contrasting DeepSeek’s agile, research-driven approach with the more structured and costly operations of larger tech firms.
As the battle for AI supremacy intensifies, the emergence of DeepSeek, with its lean team of researchers, continues to challenge China’s tech giants, who may find themselves under pressure to innovate faster and more efficiently to keep up with the rapidly evolving AI landscape.
OpenAI has raised concerns about Chinese companies attempting to access US AI technologies to enhance their models. In a statement released on Tuesday, OpenAI highlighted the critical need to protect its intellectual property and the most advanced capabilities in its AI systems. The company emphasised that it has put in place countermeasures to safeguard its innovations and is working closely with the US government to protect the technology from being exploited by competitors and adversaries.
These comments come in response to the White House’s ongoing review of national security risks posed by Chinese AI companies, particularly the rapidly growing startup DeepSeek. The US government has been looking into potential threats as China increasingly seeks to advance its AI capabilities. David Sacks, the White House’s AI and crypto czar, explained that Chinese firms are using an AI technique called “distillation,” which allows them to extract knowledge from leading US AI models, further raising concerns about intellectual property theft.
OpenAI’s statement underscores the challenges and security risks that arise as AI becomes a critical technology with broad applications, from national defence to economic competitiveness. The company’s efforts to protect its proprietary AI models are part of a broader push by the US to ensure that its technological edge is not compromised by foreign competitors who might attempt to bypass intellectual property protections. The situation highlights the increasing geopolitical tension surrounding AI development, especially as China continues to make significant strides in the field.
Spanish oil company Repsol plans to invest 4 billion euros ($4.2 billion) in building data centres near Zaragoza, according to a report by Expansion newspaper. The planned investment marks Repsol’s significant move into the tech sector, aiming to capitalise on the growing demand for cloud computing infrastructure.
Zaragoza is becoming a key hub for cloud services, with major tech companies like Amazon and Microsoft already making large investments in the region. Repsol’s project will contribute to the area’s growing reputation as a leading destination for data centre development.
The company has not yet commented on the report, and details on the project’s timeline remain unclear. This move signals a shift for Repsol as it expands beyond its core oil business into digital services.
Rivian, the US electric vehicle maker, and Volkswagen are in talks with other automakers about supplying them with software and electrical architecture through their joint venture. This collaboration, which began in November with Volkswagen’s $5.8 billion investment, aims to integrate advanced electrical infrastructure and Rivian’s software technology into both companies’ future EVs. Rivian’s streamlined vehicle architecture, which reduces weight and manufacturing complexity, also allows for over-the-air software updates, an area where traditional automakers have struggled to catch up.
Rivian‘s Chief Software Officer, Wassym Bensaid, revealed that other automakers are interested in the joint venture’s technology, though he declined to name them or provide details on the ongoing discussions. The venture is a key opportunity for established automakers to quickly access the technology they have long sought to develop themselves. For Rivian, the partnership provides higher volumes, better supplier deals, and a chance to reduce costs, especially important as EV demand slows.
Rivian focuses on launching its smaller, more affordable R2 SUV by 2027, while also expanding the integration of its technology into Volkswagen’s other brands. With increasing interest from additional OEMs, the joint venture is poised to become a significant player in the global EV market, particularly in the West, alongside Tesla. Analysts suggest the partnership helps Rivian address its capital concerns and positions it as a key player in the transition to software-defined vehicles.
LG Energy Solution, a major South Korean battery maker, has announced plans to reduce its capital expenditure by up to 30% this year, citing slowing demand for electric vehicles (EVs). The decision was made after the company reported a quarterly loss for the first time in three years. For the October-December period, LGES posted an operating loss of 226 billion won ($158 million), compared to a profit of 338 billion won during the same period in 2023.
The company, which supplies batteries to automakers like Tesla, General Motors, and Volkswagen, attributed its poor performance to a drop in demand from General Motors, one of its key clients. LGES expects demand to recover in the second quarter as GM launches new EV models. Additionally, the company highlighted that changes to US tariffs and potential reductions in EV tax credits could impact short-term growth in the US market, though it believes the long-term outlook for the battery industry remains strong.
In response to these challenges, LGES intends to prioritise using existing production capacity rather than expanding with new plants in North America. Despite the reduced spending, the company remains focused on growth, targeting a revenue increase of 5-10% this year. LGES will also launch joint battery production with Stellantis and Honda later this year. CEO Kim Dong-myung has expressed optimism about a recovery in the EV market after 2026, though he also acknowledged growing competition from Chinese rivals.
Shares of LGES remained flat following the announcement, while the broader KOSPI index saw a slight rise.
Stargate, a new joint venture formed by OpenAI, SoftBank, and Oracle, aims to build data centres across the US to support the growing demands of AI. According to a report by the Financial Times on Thursday, these data centres will be dedicated solely to OpenAI, the company behind the popular ChatGPT. The collaboration between these tech giants underscores the increasing importance of robust infrastructure to power the next wave of AI innovation.
The exclusive focus on OpenAI’s needs comes when AI technologies rapidly expand, with the demand for high-performance computing capabilities soaring. The partnership will allow OpenAI to scale its operations and provide the necessary computing power for its cutting-edge AI models. As companies worldwide race to develop more advanced AI tools, the infrastructure provided by Stargate is expected to play a crucial role in supporting the next generation of AI services.
Oracle and SoftBank’s involvement brings significant expertise in cloud infrastructure and global telecom, making the venture a powerful alliance in the competitive AI landscape. The project highlights the growing intersection of cloud computing, data storage, and AI as companies like OpenAI push the boundaries of what AI can achieve.
The founder and former CEO of GameOn, an AI startup in San Francisco, has been indicted for orchestrating a six-year-long fraud scheme that allegedly defrauded investors and the company out of over $60 million. Alexander Beckman, 41, faces 23 criminal charges, while his wife, Valerie Lau Beckman, 38, who worked as a lawyer for the company, is charged with 16 counts, including obstruction. Both have pleaded not guilty. The US Securities and Exchange Commission has also filed civil charges against the couple.
Beckman is accused of deceiving investors by inflating the company’s financial status, including fabricating fake customer relationships, overstating revenue, and creating fraudulent bank statements and audit reports. He allegedly went as far as impersonating individuals to share false information. Meanwhile, Lau Beckman allegedly assisted her husband by providing authentic audit reports to help fabricate false documents and delete critical files after an investigation began.
The Beckmans are also accused of misusing investor funds for personal expenses, including purchasing a luxury home, vehicles, and covering costs for their wedding. The fraudulent activities reportedly continued up until Beckman’s resignation as CEO in July 2024. GameOn, which has since been rebranded as On Platform, eventually admitted to the financial discrepancies and laid off most of its employees.
The case underscores the need for integrity in the tech industry, particularly within startups, as federal prosecutors emphasise that fraud cannot fuel innovation.
Oracle has introduced a suite of AI agents designed to streamline tasks for sales professionals. Unlike consumer-focused virtual assistants, these agents specialise in specific functions, such as updating records after customer meetings and compiling detailed reports to assist with deal negotiations. The agents can integrate data from across Oracle’s business software ecosystem, even translating information from different languages to offer sales teams a comprehensive view of customer interactions.
A notable feature of the new system is its ability to highlight critical insights, such as delays in shipments affecting repeat customers in other regions, which can help sales teams navigate negotiations more effectively. Rob Pinkerton, Oracle’s senior vice president, emphasised the global relevance of the technology, especially for companies operating in multiple markets. The tools are particularly tailored for industries like manufacturing and logistics, where accurate and timely data is crucial.
The AI agents are available to customers starting this week at no additional cost, reflecting Oracle’s commitment to enhancing its software offerings. The move aligns with broader industry trends, as competitors like Microsoft and Google also focus on deploying specialised AI to increase productivity and tackle complex challenges in enterprise environments.
ByteDance, the Chinese tech giant behind TikTok, has allocated over 150 billion yuan ($20.64 billion) for capital expenditure this year, with a significant focus on AI, according to sources familiar with the matter. About half of the investment will support overseas AI infrastructure, including data centres and networking equipment. Beneficiaries of this spending are expected to include chipmakers Huawei, Cambricon, and US supplier Nvidia, although ByteDance has denied the accuracy of the claims.
The investment aims to solidify ByteDance’s AI leadership in China, where it has launched over 15 standalone AI applications, such as the popular chatbot Doubao, which boasts 75 million monthly active users. Its international counterparts include apps like Cici and Dreamina, reflecting ByteDance’s strategy to adapt its AI offerings globally. The company also recently updated its flagship AI model, Doubao, to rival reasoning models like those developed by Microsoft-backed OpenAI.
ByteDance’s international spending aligns with its efforts to expand AI capabilities abroad amid challenges like the uncertain future of TikTok in the United States. While ByteDance’s $20 billion plan is substantial, it remains modest compared to the AI investments of US tech giants like Google and Microsoft, which spent $50 billion and $55.7 billion respectively on AI infrastructure in the past year. The spending will also bolster ByteDance’s partnerships with suppliers such as Nvidia, from which it has procured custom AI chips tailored to China despite US export restrictions.
