The world’s 500 richest people, led by Nvidia co-founder Jensen Huang, lost a combined $US108 billion ($172 billion) on Monday as a tech-led selloff tied to Chinese AI developer DeepSeek sent major indices plunging.
Billionaires whose fortunes are linked to artificial intelligence were the biggest losers: Huang saw his fortune fall $US20.1 billion, a 20 per cent drop, while Oracle co-founder Larry Ellison’s $US22.6 billion loss was larger in absolute terms, but represented just 12 per cent of his fortune, according to the Bloomberg Billionaires Index. Dell’s Michael Dell lost $US13 billion, and Binance co-founder Changpeng “CZ” Zhao shaved $US12.1 billion.
Nvidia founder Jensen Huang lost more than $US20 billion on Monday.Credit: Bloomberg
Tech-sector titans as a group saw $US94 billion of wealth evaporate — roughly 85 per cent of the Bloomberg index’s total decline. The Nasdaq Composite Index fell 3.1 per cent, and the S&P 500 dropped 1.5 per cent.
Hangzhou-based DeepSeek has been developing AI models since 2023, but the company first came onto the radar of many Western investors this weekend as its free DeepSeek R1 chatbot app topped download charts worldwide. So many new users piled in that DeepSeek struggled to keep the app online, suffering outages and forcing it to restrict signups to users with Chinese phone numbers.
DeepSeek’s dark-horse entry into the AI race, which it says cost just $US5.6 million to develop, is a challenge to Silicon Valley’s narrative that massive capital spending is essential to developing the strongest models. That delivered a serious blow to billionaires whose fortunes are tied to the Western AI supply chain that’s been the equities market’s biggest driver over the past two years.
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Similar Playbook
Soaring valuations for so-called AI hyperscalers — including Meta, Alphabet and Microsoft — have generated billions in wealth for their owners since OpenAI unveiled ChatGPT in November 2022. These companies have for the most part operated on a similar playbook: Spend huge sums to develop and run AI systems by hoarding top-of-the-line semiconductors and the energy supplies needed to run them.
Meta chief executive officer Mark Zuckerberg announced on Friday that the company planned to spend $US60 billion to $US65 billion on projects related to AI this year, well above Wall Street estimates. Capital spending across all Big Tech firms is on pace to reach $US200 billion in 2025, according to a Bloomberg Intelligence report.
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