Nvidia recovers as DeepSeek fears fade
Despite initial fears, DeepSeek’s activity increased demand in China, putting Nvidia in a stronger position instead of undermining its market.
Earlier this year, Nvidia shares declined following concerns over DeepSeek and the possibility that tech giants might reduce AI-related spending. Worries over export restrictions added to investor unease.
However, Wedbush Securities’ managing director Matt Bryson believes the DeepSeek issue is now firmly behind the company. According to Bryson, DeepSeek — mostly a China-based phenomenon — unexpectedly boosted demand for AI servers, which ultimately benefited Nvidia instead of hurting it.
Another key development is Oracle’s plan to spend around $40 billion on Nvidia’s GB200 chips to power OpenAI’s new data centre.
Bryson suggested this is part of a broader trend among hyperscalers like Oracle and Crusoe, which recently secured funding to build new facilities. He expects this spending to appear in Nvidia’s earnings as early as Q2 or Q3, instead of being delayed until the next chip generation, the GB300.
Looking ahead, investors remain focused on whether major tech firms will sustain their AI investment. Bryson pointed out that recent earnings reports from companies like Microsoft, Alphabet, and Meta show they remain committed to high capital expenditures.
Instead of retreating, Big Tech appears set to continue driving demand for AI infrastructure, which supports Nvidia’s long-term prospects.
Bryson also noted a significant new factor in AI growth: sovereign deals from countries such as Saudi Arabia and the UAE. He emphasised that the UAE’s expected chip purchases may even surpass Oracle’s.
The new demand, combined with increasing investments in AI-powered edge products — such as those hinted at by OpenAI’s collaboration with Jony Ive — signals that AI spending beyond 2025 will remain strong instead of slowing.
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