market plunge

DeepSeek AI challenge to Nvidia reverberates in Abu Dhabi, Dubai

G42 and International Holding Co., which have billion-dollar deals with Nvidia, stand to lose if China's DeepSeek can follow through with its AI model

Nvidia CEO Jensen Huang with the UAE's AI Minister Omar Al Olama last February in Dubai (Credit: Nvidia)

The emergence of DeepSeek, the Chinese startup whose artificial intelligence capabilities rival those of Nvidia and triggered a 17% plummet in the U.S. chipmaker’s shares, is being felt in the Gulf.

G42, International Holding Co. and other Abu Dhabi companies that have billions of dollars in active deals with Nvidia stand to lose if DeepSeek can follow through with its plans to provide advanced AI functions at a fraction of the cost. Nvidia’s market value plunged $589 billion on Monday.

Damac Properties Chairman Hussain Sajwani, for example, pledged $20 billion to U.S. President Donald Trump two weeks ago to build AI data centers, which may not ever be built if DeepSeek’’s technology proves itself.

“The introduction of DeepSeek’s cost-effective solutions has disrupted… anticipations of expansive investments in AI, leading to a sharp market correction,” Roberto d’Ambrosio, CEO of Axiory Global, told The Circuit’s Omnia Al Desoukie in Dubai.

“From a risk management perspective, this development underscores the perils of over-reliance on anticipated technological trajectories,” d’Ambrosio said, noting the possible downside for G42 and other companies backed by IHC – which is led by Sheikh Tahnoon bin Zayed, the UAE National Security Advisor and Chairman of sovereign wealth funds ADQ and ADIA.

“The rapid advancement of AI capabilities, coupled with the emergence of more affordable alternatives, necessitates a reassessment of investment strategies,” he said.