Broadcom’s business relies heavily on their networking products, which are crucial for data transfer in AI systems. If the market for premium AI chips experiences a downturn, amid the rise of DeepSeek, it could create a domino effect, potentially hurting sales of Broadcom’s supporting technologies and components.

Here’s what you need to know about DeepSeek, the Chinese AI startup that rattled markets as its app dethroned OpenAI's as the most-downloaded free app in the U.S. on Apple.

U.S. stocks recovered some ground Tuesday morning after getting hammered by fears over China's DeepSeek AI model built on a shoestring budget.

Barrett Woodside, co-founder of the San Francisco AI hardware company Positron, said he and his colleagues have been abuzz about DeepSeek.

The Nasdaq could face market-cap losses of nearly $1 trillion if premarket declines hold into the close of trading.

Nvidia staged a moderate rebound on Tuesday, rising as much as 3%, following a 17% drop the prior day. More broadly, major US indexes rallied after the S&P 500 and Nasdaq 100 saw sharp losses on Monday amid concerns over the Chinese AI firm DeepSeek's rapid and seemingly cost-effective advances.

DeepSeek released an open-source artificial intelligence model in December, saying it took only two months and less than $6 million to create it.