Analysts say that DeepSeek is the 'Temu of AI' as it wreaks havoc on the expensive AI industry

Wedbush analysts say that DeepSeek's success will be short lived, and that China's game-changing ChatGPT competitor is the 'Temu of AI'.

Analysts say that DeepSeek is the 'Temu of AI' as it wreaks havoc on the expensive AI industry
Comment IconFacebook IconX IconReddit Icon
Gaming Editor
Published
Updated
3 minutes read time
TL;DR: DeepSeek has disrupted the AI industry, causing a $2 trillion impact on the US stock market. Analysts view it as a temporary concern, likening it to a "tech AI head fake." Despite its low training cost of $5.6 million, DeepSeek's model is not expected to significantly disrupt major US tech companies.

DeepSeek has been in the headlines as it has completely upended the entire AI industry, swiping $2 trillion off the US stock market, and now analysts have called the Chinese AI firm the "Temu of AI".

Analysts say that DeepSeek is the 'Temu of AI' as it wreaks havoc on the expensive AI industry 601

Now we've got Wedbush analysts, led by Dan Ives, saying in a new note that they "view the DeepSeek fear across the tech world as in essence a 'tech AI head fake' that will be short-lived as more details and analysis comes out about DeepSeek's model and China resources".

DeepSeek's new R1 model only cost $5.6 million to train, which is insane considering that that's about the salary of an American expert in AI can command. AI training costs so, so much more on the opposite side of the pond with prices ranging between $100 million up to $1 billion and beyond... so you can see why analysts have their knickers in a twist.

OpenAI's GPT-4 model cost over $100 million to train, directly from the mouth of CEO Sam Altman... so $5.6 million to train DeepSeek R1 and disrupt the AI industry is a massive game changer. The Wedbush analysts continued: "DeepSeek created an awesome LLM model (and credit to its software developers) however this Chinese AI small lab/LLM model is not bringing down the entire US tech ecosystem with it".

They added: "Just like Temu was the 'Amazon (AMZN) model destroyer' a few years ago... Amazon's team adjusted and now look".

The analysts explained: "We have spoken to many enterprises heading down the AI path/use cases in no way does DeepSeek make them flinch on spending seven/eight figures of their IT budgets over the next year on AI initiatives. DeepSeek does not disrupt the $2 trillion of AI Cap-Ex set for the next 3 years with NVIDIA, Microsoft, Google, Amazon, Palantir, ServiceNow, Salesforce, Oracle, TSMC, and others front and center poised to benefit".

"LLM models will become cheaper and more commoditized over time...the value however is in the data, use cases, algorithm reasoning, and storage for AI. In a nutshell, DeepSeek created an awesome LLM model (and credit to its software developers) however this Chinese AI small lab/LLM model is not bringing down the entire US tech ecosystem with it. Just like Temu was the"Amazon model destroyer"a few years ago...Amazon's team adjusted and now look".

Photo of the AMD Ryzen 7 9800X3D
Best Deals: AMD Ryzen 7 9800X3D
Country flag Today 7 days ago 30 days ago
$497 USD $595.99 USD
Buy
-
$599 USD -
Buy
$689 CAD $1086 CAD
Buy
- $829.98 CAD
Buy
£514 £548
Buy
$497 USD $595.99 USD
Buy
* Prices last scanned on 2/18/2025 at 9:45 am CST - prices may not be accurate, click links above for the latest price. We may earn an affiliate commission from any sales.

Gaming Editor

Email IconX IconLinkedIn Icon

Anthony joined the TweakTown team in 2010 and has since reviewed 100s of graphics cards. Anthony is a long time PC enthusiast with a passion of hate for games built around consoles. FPS gaming since the pre-Quake days, where you were insulted if you used a mouse to aim, he has been addicted to gaming and hardware ever since. Working in IT retail for 10 years gave him great experience with custom-built PCs. His addiction to GPU tech is unwavering and has recently taken a keen interest in artificial intelligence (AI) hardware.

Related Topics

Newsletter Subscription