Click here to access exclusive investment research and ad free browsing! Click here to access exclusive research! Investors are pulling back from the artificial intelligence trade. Previously, a report by the Lawrence Berkeley National Laboratory highlighted that US data centers are expected to use 6.
However, one artificial intelligence startup has upended these estimates, leaving investors wondering whether the anticipated surge in power demand and data center expansion still holds. Energy, infrastructure, and real-estate stocks were tanking on Monday, even though they were known to be less crowded alternatives to stocks such as Nvidia. DeepSeek, an artificial intelligence startup from China, caused a frenzy in the AI world after launching its latest AI models. The company claims that these models built are at par or better than industry-leading models in the United States.
They require fewer chips and are made at a fraction of the cost. All of these updates are now threatening to upset the technology world.
Once the best-performing securities over the past 18 months, US electricity providers are now one of the hardest hit sectors with investors reevaluating their outlooks toward artificial intelligence and the magnitude of money that they are spending.
Nevertheless, investors are concerned that the wider adoption of models, such as those by DeepSeek, could result in lesser demand for electricity and also require a smaller power build-out. DeepSeek AI is also threatening the dominance of current leaders in the artificial intelligence world. This could potentially slow down the deployment of their data centers.
