NVIDIA FACES A RECKONING AS AN UPSTART RIVAL RAISES QUESTIONS ABOUT WALL STREET'S DARLING

The superstar run for Nvidia’s stock the last few years has been astonishing. So was its tumble Monday, which caused $595 billion in wealth to vanish. That’s about as much as PepsiCo, McDonalds, Starbucks and Target are worth, combined.

Mostly known only in gaming and crypto circles a few years ago, Nvidia burst into the zeitgeist after seeing its sales surge because customers wanted its chips to train their chatbots and other artificial intelligence products.

Nvidia became a household name as its stock more than tripled in 2023 and then more than doubled in 2024. Investors and analysts lauded CEO Jensen Huang as the “Godfather of AI.” Nvidia grew into a $3 trillion-plus behemoth and traded places with titans like Apple to become the most valuable company on Wall Street.

But that all came to a screeching halt Monday, at least for a moment, after a Chinese upstart called DeepSeek said it had developed a large-language model that could perform like ChatGPT and other U.S. rivals, but by using far less computing power.

Here’s a look at how it all got to this point:

HOW DID IT BECOME A MARKET DARLING?

Nvidia’s roots began in gaming.

The Santa Clara, California-based tech company’s invention of the graphics processor unit, or GPU, in 1999 helped spark the growth of the PC gaming market and redefined computer graphics. Now Nvidia’s specialized chips are key components that help power different forms of artificial intelligence, including the latest generative AI chatbots such as ChatGPT and Google’s Gemini.