DeepSeek’s New AI Model Fails to Excite Markets

Market reaction to DeepSeek’s preview of its next-generation artificial intelligence (AI) model has so far been subdued, compared with the Chinese startup’s outsized global breakthrough last year following the launch of its low-cost AI models, Eduardo Baptista reported for Reuters.

The muted response to DeepSeek-V4 suggests market expectations have shifted.

The release and international reception of DeepSeek-V3 and R1—which the Hangzhou-based company said were trained using a fraction of the computing power required by US rivals—triggered a global tech stock selloff as investors questioned heavy spending on AI infrastructure.

That moment was widely viewed by analysts as a “black swan” event, forcing a reassessment of assumptions around cost, competition, and China’s ability to innovate under US chip restrictions.

However, the muted response to DeepSeek-V4 suggests those expectations have shifted.

Markets and industries have grown accustomed to low-cost, efficient models developed under computing constraints, reducing the element of surprise.

“This announcement followed a rather predictable path,” said Lian Jye Su, chief analyst at Omdia, noting that advances in model architecture and efficiency are now widely explored across industry and academia.