Jim Cramer said Monday there’s no need to panic and dump shares of Nvidia due to the emergence of Chinese AI startup DeepSeek. But he said it’s also too soon to say whether the steep pullback is a buying opportunity. Right now, “I do not have the knowledge to be able” to say buy the dip in Nvidia, Jim said before Monday’s opening bell. “Sometimes you have to admit … I’m not sure what to do. It’s not a cop out. I’m not sure what to do.” Shares of artificial intelligence chip king Nvidia tumbled more than 11% in early trading, part of a broader sell-off in stocks linked to the AI trade, as investors grapple with the implications of DeepSeek’s new AI model and chatbot. The tech-heavy Nasdaq Composite fell by roughly 3%. The S & P 500 lost about 1.7%. DeepSeek claims its model was trained on older versions of Nvidia’s high-powered AI chips and the development cost just a fraction of what U.S. tech giants such as Meta Platforms have been spending on their own AI pursuits. While AI experts are generally impressed with DeepSeek’s capabilities — and its app shot up to No. 1 on Apple’s App Store, supplanting OpenAI’s ChatGPT — some people are doubting the veracity of its claims. Analysts at Citigroup, for example, told clients that they “question the notion that its feats were done without the use of advanced GPUs” at some point in the development. Still, the heart of the matter is basically: If DeepSeek was able to make such a competitive, cost-efficient AI model, will companies need to spend as much on Nvidia’s latest and greatest chips? Jim said as he tries to answer that question, he keeps coming back to the recent announcements by Meta CEO Zuckerberg and Oracle’s Larry Ellison. Meta’s planned capital expenditures for 2025 and Oracle’s participation in a massive data-center expansion initiative showed the companies planned to continue spending billions on AI, with a significant share of that likely making its way into Nvidia’s coffers. “When in doubt, do you go against Zuckerberg? Do you go against Ellison? I come back and say, I don’t know. Sometimes it’s better to say I don’t know,” Jim said. Jim and Director of Portfolio Analysis Jeff Marks will shine more light on DeepSeek and its potential implications for the rest of our stock portfolio at the Morning Meeting, which as usual starts at 10:20 a.m. ET. (Jim Cramer’s Charitable Trust is long NVDA and META. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
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