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The volatility of the stock market is a well-known fact, with movements often being influenced by unexpected factors. In the case of Nvidia, the recent release of DeepSeek’s AI models has caused a significant shake-up in the sector, leading to a decline in Nvidia’s stock even as it launches its highly anticipated RTX 5090 and 5080 graphics cards.
### Nvidia RTX series delays
The demand for Nvidia’s new RTX 50 series graphics cards is high, but the company has been struggling to keep up with supply. Online retailers sold out quickly, leading to scalpers selling the cards at a premium. Reports of manufacturing issues have also surfaced, contributing to delays and low stock quantities. These factors, while not necessarily stock-dropping on their own, have impacted Nvidia’s recovery expectations from the RTX 50 series release.
### DeepSeek’s looming threat
The release of DeepSeek’s AI models has posed a significant threat to U.S.-based AI companies like Nvidia. With claims of creating models comparable to OpenAI’s at a fraction of the cost, DeepSeek has rattled the industry. Moreover, the development of even more advanced models by DeepSeek and other China-based companies like Alibaba signifies a continued threat to Nvidia’s dominance in the AI processing power market.
### Trump’s Taiwan tariff threat
President Trump’s announcement of tariffs on foreign production of computer chips, semiconductors, and pharmaceuticals, with the aim of bringing manufacturing back to the U.S., has added to Nvidia’s challenges. Companies like Nvidia, which produce chips in Taiwan, could face increased costs and potential price hikes for their products. This could lead to reduced sales or profit margins as companies adjust to the impact on consumer prices.
Overall, Nvidia’s stock performance in the face of these challenges reflects the complex and interconnected nature of the global market and the need for companies to adapt to changing geopolitical and technological landscapes.
