Chinese AI startup DeepSeek has stirred conversation in the tech community by claiming that its AI models could achieve a “cost profit margin” of 545% under ideal conditions.
In a post on X, the company presented calculations based on “theoretical income” that suggest its online services, if fully billed at premium rates, could generate substantial daily revenue relative to operating costs.
According to DeepSeek, a 24-hour period of usage for its V3 and R1 models would yield an estimated $562,027 in revenue if all usage were billed at R1 pricing. In contrast, the cost of leasing the necessary GPUs for this level of service would have been approximately $87,072. These figures, detailed at the end of a longer GitHub post outlining its strategy for achieving higher throughput and lower latency, imply impressive profit margins when operating under optimal conditions.
However, DeepSeek acknowledged that actual revenue figures are “substantially lower” due to several factors. These include nighttime discounts, reduced pricing for its V3 model, and the fact that only a subset of its services is monetized—with its app and website remaining free to users. Critics note that while the calculations offer a glimpse into potential future profitability, they remain highly speculative given the various discounts and free offerings that currently impact overall revenue.
DeepSeek’s announcement comes amid broader industry debates over the cost structure and profit potential of AI services. The startup previously captured headlines in January when it unveiled a new model that, according to some benchmarks, matched the performance of OpenAI’s offerings despite being developed at a significantly lower cost and under the constraints of U.S. trade restrictions on powerful chips.
The company’s technology has also made an impact in the consumer space. At one point, the DeepSeek app briefly displaced OpenAI’s ChatGPT at the top of Apple’s App Store rankings before falling to a current position of #6 in the productivity category—positioned behind ChatGPT, Grok, and Google Gemini.
As the race for efficient and profitable AI technologies continues, DeepSeek’s bold profit margin claims underscore the high stakes and rapid innovation defining the industry. While the figures may point to an optimistic future, experts remain cautious, emphasizing that real-world performance and market dynamics will ultimately determine the financial viability of such models.
China has narrowed the artificial intelligence (AI) development gap with the United States to just three months in certain areas, according to Lee Kai-fu, the CEO of Chinese AI startup 01.AI.
U.S. Commerce Department bureaus have reportedly issued a blanket ban on the Chinese AI model DeepSeek for use on government-furnished equipment, according to sources and a mass email seen by Reuters.
Chinese retail investors are increasingly turning to DeepSeek and other artificial intelligence tools to navigate the stock market, marking a significant shift from last year’s government crackdown on computer-driven quantitative trading.
The Trump administration is reportedly considering a ban on the Chinese AI chatbot DeepSeek from U.S. government devices over national-security concerns, according to a source familiar with the matter.
Elon Musk-owned artificial intelligence firm xai has acquired a 1-million-square-foot property in southwest Memphis, the Greater Memphis Chamber reported on Friday.
Start your day informed with AnewZ Morning Brief: here are the top news stories for April 3rd, covering the latest developments you need to know.
Myanmar's deadly 7.7-magnitude earthquake has claimed over 3,000 lives, with 351 missing and 4,500 injured. As rescue efforts face civil unrest, unseasonal rains threaten survivors. Global aid arrives, while Myanmar's junta declares a ceasefire to support relief efforts.
Russian President Vladimir Putin's investment envoy Kirill Dmitriev met with U.S. officials in Washington on Wednesday as the Trump administration continues to press Russia and Ukraine to agree to a ceasefire, two U.S. officials familiar with the matter said.
Taiwan has reported a sharp increase in Chinese military activity as Beijing concluded two days of war games around the island, intensifying tensions across the Taiwan Strait.
Hunter Biden has voluntarily surrendered his license to practice law in Washington, D.C., following criminal convictions that raised questions about his professional eligibility.
Aid groups in Myanmar’s worst-hit areas urgently need shelter, food, and water after a devastating 7.7 magnitude earthquake killed over 2,700 people. Rescue efforts face challenges due to ongoing civil war, damaged infrastructure, and restricted aid access, with the toll expected to rise.
French far-right leader Marine Le Pen was banned from running for public office for five years after being convicted of embezzlement, ruling her out of the 2027 presidential race. She received a four-year prison sentence, with two years suspended, and a €100,000 fine. Le Pen plans to appeal.
Apple marked its 49th anniversary by reaching a market capitalization of $3.3 trillion. Despite recent tech stock volatility, Apple's shares surged 28% in 2024.
The Armenian armed forces attempted three reconnaissance drone flights over Azerbaijan Army positions near Gerenzur, but all were successfully intercepted. Meanwhile, Armenian units repeatedly fired on Azerbaijani positions from multiple regions, escalating tensions in the area.
Neuralink plans to implant its first Blindsight vision chip in a human by the end of the year, enabling vision for those born blind, according to Elon Musk. The device could eventually surpass natural vision, allowing users to see in infrared, ultraviolet, and radar ranges.
Researchers at Rice University have made a groundbreaking discovery in the field of strange metals—materials that defy conventional understanding of electricity and magnetism
Airbus UK wins a £150 million-contract to engineer landing platform that will safely deliver the first European rover on Mars. First British-built rover will explore the red planet in 2030 for signs of present and past life on Mars.
The model aims to enhance Alibaba’s presence in the generative AI sector and is available as open-source.
OpenAI has asked the US government to permit AI companies to use copyrighted material for training to maintain America's leadership in AI development, as part of a proposal aligned with President Trump's upcoming "AI Action Plan."
Start your day informed with AnewZ Morning Brief: here are the top news stories for April 3rd, covering the latest developments you need to know.
Myanmar's deadly 7.7-magnitude earthquake has claimed over 3,000 lives, with 351 missing and 4,500 injured. As rescue efforts face civil unrest, unseasonal rains threaten survivors. Global aid arrives, while Myanmar's junta declares a ceasefire to support relief efforts.
Russian President Vladimir Putin's investment envoy Kirill Dmitriev met with U.S. officials in Washington on Wednesday as the Trump administration continues to press Russia and Ukraine to agree to a ceasefire, two U.S. officials familiar with the matter said.
Taiwan has reported a sharp increase in Chinese military activity as Beijing concluded two days of war games around the island, intensifying tensions across the Taiwan Strait.
Hunter Biden has voluntarily surrendered his license to practice law in Washington, D.C., following criminal convictions that raised questions about his professional eligibility.
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