DeepSeek stunned the tech world with the release of its R1 "reasoning" model, matching or exceeding OpenAI's reasoning model for a fraction of the cost.

Nvidia called DeepSeek's R1 model "an excellent AI advancement," despite the Chinese startup's emergence causing the chip maker's stock price to plunge 17%.

So, let's consider a few facts for a moment. Reuters reports that DeepSeek's development entailed 2,000 of Nvidia's H800 GPUs and a training budget of just $6 million, while CNBC claims that R1 "outperforms" the best LLMs from the likes of OpenAI and others.

Nvidia (NASDAQ: NVDA) has soared over the last two years, thanks to its dominance in artificial intelligence (AI) -- a market set to reach $1 trillion by the end of the decade from about $200 billion today.

Nvidia remains a compelling investment due to its leadership in the GPU market and projected significant growth in EBITDA and free cash flow. Learn more on NVDA stock here.

Nvidia stock rose early Tuesday as the AI chipmaker began to recover from a massive decline the prior day that shaved nearly $600 billion off its market cap.

The S&P 500 and the Nasdaq hit over one-week lows, as the surging popularity of a low-cost Chinese artificial intelligence model DeepSeek knocked shares of chipmaker Nvidia and other companies benefiting from investments into the technology.