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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.
The world’s biggest dance music festival faces an unexpected setback as a fire destroys its main stage, prompting a last-minute response from organisers determined to keep the party alive in Boom, Belgium.
According to the German Research Centre for Geosciences (GFZ), a magnitude 5.7 earthquake struck the Oaxaca region of Mexico on Saturday.
China and the Association of Southeast Asian Nations will send an upgraded ‘version 3.0’ free-trade agreement to their heads of government for approval in October, Chinese Foreign Minister Wang Yi said on Saturday after regional talks in Kuala Lumpur.
A resumption of Iraq’s Kurdish oil exports is not expected in the near term, sources familiar with the matter said on Friday, despite an announcement by Iraq’s federal government a day earlier stating that shipments would resume immediately.
Chinese automaker Chery has denied an industry-ministry audit that disqualified more than $53 million in state incentives for thousands of its electric and hybrid vehicles, insisting it followed official guidance and committed no fraud.
Scientists have discovered previously unknown communities of deep-sea creatures that survive by converting chemicals into energy, rather than feeding on organic matter, during dives into two of the Pacific Ocean’s deepest trenches.
The acting chief of the U.S. space agency NASA is expected to unveil a directive this week to build a nuclear reactor on the moon by 2030, according to U.S. media reports, as the United States seeks to strengthen its space presence amid growing competition from China and Russia.
Scientists in Norway have uncovered remains of more than 40 species from around 75,000 years ago, shedding new light on Ice Age life in Scandinavia.
Türkiye’s first domestically produced electric SUV, the Togg T10X, is expected to hit the German market by the end of 2025, German daily Bild reported.
A SpaceX Falcon 9 rocket successfully launched from NASA’s Kennedy Space Center in Florida on Friday, sending an international crew of four astronauts to the International Space Station (ISS) aboard the Dragon spacecraft as part of NASA’s Crew-11 mission.
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