A wave of Big Tech companies reported quarterly earnings in recent weeks — including six of the so-called Magnificent 7 firms — shortly after Chinese AI startup DeepSeek rattled the stock market as investors saw its new, cheap artificial intelligence models as an ominous sign for US tech stocks.
DeepSeek’s innovations so shook the US tech industry that AI darling Nvidia (NVDA) saw $600 billion shaved off its market cap in a single day — the biggest loss in stock market history — as investors worried Big Tech would slow its spending on AI hardware.
Now, some US lawmakers are pushing to ban the app from government-owned devices, according to the Wall Street Journal.
On earnings calls with investors, executives across these firms were quick to praise DeepSeek’s artificial intelligence models, dismissed them, or attempted to avoid the topic altogether.
US tech executives’ reactions to the sell-off — which impacted most of their stocks — ranged from defensive to excited. While most agreed the DeepSeek news is a sign that AI costs will come down eventually, they reaffirmed their commitments to spending massive sums on capital expenditures and other investments for AI infrastructure in 2025, despite a lack of clarity about when the payoff for that spending will come.
Here’s what they said.
Microsoft (MSFT) CEO Satya Nadella was quick to embrace DeepSeek, mentioning the firm in his opening remarks on a post-earnings call on Jan. 29.
Nadella pointed to Microsoft’s move to put DeepSeek’s latest AI model on its developer platforms, Azure AI Foundry and GitHub, adding that it went through “automated red teaming, content safety integration, and security scanning.” He said customers will soon be able to run DeepSeek’s models locally on Microsoft’s AI PCs.
“I think DeepSeek has had some real innovations,” Nadella said, adding that he sees AI getting “commoditized.”
“For a hyperscaler like us, a PC platform provider like us, this is all good news as far as I’m concerned.”
Meta (META) — which one tech analyst recently described as “the most well-placed company to take advantage of generative AI” given its advertising business — saw its stock climb on DeepSeek’s debut of its new AI model called R1, with shares rising nearly 2% on the day of the news.
CEO Mark Zuckerberg was relatively nonchalant about the DeepSeek frenzy.
When questioned on whether the potential for lower-cost AI models would affect Meta’s capital expenditures, the chief executive said in a call following the company’s latest quarterly earnings: “I don’t know — it’s probably too early to really have a strong opinion on what this means for the trajectory around infrastructure and capex and things like that.”
