NVIDIA shares in equity investors have just received good news from Meta Platforms and Microsoft

China’s Deepseek recently published a research document that shocked Wall Street. The start-up claims to have spent less than $ 6 million to form an artificial intelligence model (AI) whose performance corresponds or almost correspond to those of the main American models. Compared, Openai spent more than $ 100 million on its GPT-4 model.

Nvidia (NVDA -3.67%)) The stock has greatly decreased on the news. Its market value has dropped nearly $ 600 billion in a single day, the biggest daily loss of any listed business in history. The logic behind the crash is simple: if Deepseek has built a good AI model for less money, American companies can use the same training methods to carry out similar efficiency.

Consequently, investors are worried that American companies would spend less than expected for NVIDIA GPUs, who are generally the most expensive line element in IA infrastructure budgets. But the market may have reacted excessively. Nvidia shareholders have just received good news from Meta-platforms (Meta 0.32%)) And Microsoft (Msft 0.02%))Two of its greatest customers.

Read the rest to find out more.

Good news of Meta platforms: CEO Mark Zuckerberg considers heavy investments in AI as a strategic advantage

Meta Platforms CFO Susa Li declared to analysts to call the profits of the fourth quarter that capital expenses would increase up to 66% to $ 65 billion in 2025 to support its generative AI efforts and its main cases. This represents a material acceleration from the 39% increase in capital spending last year.

The CEO, Mark Zuckerberg, also provided a context, indicating to analysts the capacity of Meta to spend strongly on AI will be a “strategic advantage” over time. He also said that more effective training methods do not necessarily reduce the need for AI chips. Instead, he considers recent breakthroughs as an opportunity to apply more computing power to inference workloads to “generate a higher level of intelligence and better quality of service”.

Good news from Microsoft: CEO Satya Nadella says that demand will increase exponentially as AI becomes more affordable

In order not to be out of the deepseek, Microsoft CEO, Satya Nadella, said during the last profit call: “We have noticed significant efficiency gains in training and inference for years now .

However, Nadella thinks that the consequences will be favorable to Nvidia. “While AI becomes more efficient and accessible, we will see more request exponentially,” he told analysts on the call. Nadella also posted on X: “Jevons Paradox strikes again! As AI becomes more efficient and accessible, we will see its use soaring.”

What the Jevons paradox means for Nvidia

In the 1860s, economist William Stanley Jevons argued that technological progress that made coal a more effective energy source paradoxically created more coal demand. In other words, Jevons thought that cost reductions resulting from the greatest performance of coal prices were more than compensated by the increase in the resulting expenses.

When applied to Nvidia, the Jevons paradox means that more effective AI training methods will ultimately stimulate more software and AI services demand. In turn, cost savings resulting from improving the performance of GPU prices can be more than offset by the increase in demand for these AI processors.

Indeed, since Deepseek published his report, Morgan Stanley Analysts have revised their estimates of capital expenses, so that IA infrastructure expenses among the four largest hyperscalers – Amazon,, AlphabetMeta and Microsoft – should increase by 32% to 317 billion dollars in 2025, compared to 28%. And this figure could increase more after Amazon and Alphabet report the financial results this week.

Above all, the other Wall Street analysts seem to think about similar lines. Despite the new Deepseek, Nvidia still has a median target price of $ 175 per share among the 67 analysts that follow the company. This implies 45% of the increase in its current $ 120 course.

Randi Zuckerberg, former Director of Development of the Facebook and Sister of the CEO of Meta Platforms, Mark Zuckerberg, is a member of the board of directors of Motley Fool’s. John Mackey, former CEO of Whole Foods Market, a subsidiary of Amazon, is a member of the board of directors of Motley Fool’s. Suzanne Frey, director of Alphabet, is a member of the board of directors of Motley Fool’s. Trevor Jennewine occupies positions in Amazon and Nvidia. The Motley Fool has positions and recommends Alphabet, Amazon, Meta Platforms, Microsoft and Nvidia. The Motley Fool recommends the following options: Long January 2026 Calls $ 395 on Microsoft and Court January 2026 405 $ calls Microsoft. The Motley Fool has a policy of disclosure.