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DeepSeek Researcher Voices Pessimism About AI’s Future Impact Despite Company’s Global Success

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In its first major public appearance since becoming a global AI sensation, Chinese developer DeepSeek struck a surprisingly cautious tone about the technology’s long-term impact on society.

At the World Internet Conference in Wuzhen, Chen Deli, a senior researcher at DeepSeek, warned that artificial intelligence could create major social disruptions within the next two decades. “In the next 10–20 years, AI could take over the rest of work humans perform and society could face a massive challenge,” Chen said. “I’m extremely positive about the technology, but I view the impact it could have on society negatively.”

Chen shared the stage with executives from five other Chinese AI companies—Unitree, BrainCo, and others—collectively referred to as the country’s “six little dragons” of AI innovation. While praising AI’s potential in the short term, Chen stressed that companies like DeepSeek must act as “defenders” of social stability as automation accelerates.

DeepSeek rose to global prominence in January after releasing a low-cost open-source AI model that outperformed several leading U.S. systems. The company’s meteoric rise has since made it a symbol of China’s technological resilience amid intensifying competition with the United States.

Despite its success, DeepSeek has remained mostly silent publicly. Its only major appearance this year came when founder and CEO Liang Wenfeng met President Xi Jinping in February. The company has since skipped several major tech events, adding to its enigmatic reputation.

DeepSeek has continued developing its technology quietly, unveiling in September a new V3 model that it described as “experimental,” optimized for efficiency and longer text processing. Its work has also boosted China’s domestic chip ecosystem: hardware makers Cambricon and Huawei now build processors compatible with DeepSeek’s models.

In August, DeepSeek’s announcement of an upgraded model optimized for Chinese-made chips caused local semiconductor stocks to surge—underlining how the company remains both a technical pioneer and a national symbol of self-reliance in AI.

China investors stay bullish on Cambricon despite index reshuffle

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Cambricon Technologies, often dubbed China’s Nvidia, faces more than 8 billion yuan ($1.1 billion) in passive outflows due to a quarterly rebalancing of the STAR50 Index, but analysts say investor confidence in the AI chipmaker remains intact.

The company’s stock, which more than doubled in August, exceeded the 10% cap for individual weightings in the tech-heavy index. Though Cambricon shares fell 14% last week on profit-taking and rebalancing fears, they have since rebounded 10%, hovering near record highs.

Valuations are eye-watering—Cambricon trades at 521 times earnings, compared with Nvidia’s multiple of 50—but Beijing’s push for tech self-sufficiency, the DeepSeek AI breakthrough, and large-scale investments by Alibaba, Tencent, and Baidu continue to fuel the rally.

“Maybe some investors will use it as a reason to take profit, but I don’t think that will affect the long-term trend,” said Shihao Li, analyst at CLSA. Gavekal’s Tilly Zhang added that optimism is growing that China’s AI sector has entered a “self-sustaining cycle of rising investment and higher profitability.”

Cambricon’s fundamentals have helped power the surge. First-half revenue jumped to 2.9 billion yuan ($407 million) from just 64.8 million yuan a year earlier, swinging to a 1 billion yuan profit. The company forecasts 5–7 billion yuan in operating revenue for 2025.

Still, risks remain. Some fund managers warn of a speculative bubble, while others argue that growth potential tied to China’s strategic need to replace foreign AI chips may justify lofty valuations.

Broader Chinese markets are riding the same wave. The CSI AI Index is up 60% this year, far outpacing the 15% gain in the CSI300, and the Shanghai Composite has hit levels not seen in a decade.

The spotlight now shifts to whether Cambricon can sustain profitability and meet surging demand for AI chips—critical to maintaining its role as the flagship of China’s AI boom.

H3C Warns of Nvidia AI Chip Shortage as Chinese Demand Surges

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One of China’s top server manufacturers, H3C, has reportedly warned of a looming shortage of Nvidia’s H20 AI chip—the most advanced processor currently available for sale in China under U.S. export rules. The notice, seen by Reuters, indicates rising concerns about disruptions in the international supply chain and signals possible obstacles for China’s AI development ambitions.

According to the document dated Tuesday, H3C informed clients that existing inventories of the H20 chip are “nearly depleted,” with new shipments only expected around mid-April. The notice blamed geopolitical tensions and raw material disruptions for the uncertainty. It also highlighted challenges in future supply planning beyond April 20 due to changes in shipping routes, production complications, and evolving policy environments.

Shortly after publication, Nvidia declined to comment, and H3C issued a clarification stating that “neither the company nor any of its departments have issued this notice or its related content.” However, industry sources confirmed that the chip is becoming increasingly difficult to obtain.

. AI Boom Driving Surging Demand
Demand for the H20 has sharply risen since January, driven by the popularity of Chinese startup DeepSeek’s cost-efficient AI models. Major Chinese tech giants such as Tencent, Alibaba, and ByteDance have ramped up orders in response, according to previous reporting by Reuters.

An anonymous distributor told Reuters that despite prior assurances about availability, many buyers were ultimately told the chips had already been sold at higher prices. “We were told the chips would be available, but when it came time to actually purchase them, we were informed they had already been sold at higher prices,” the source said.

. Geopolitical Pressures and U.S. Export Controls
The H20 chip was specifically designed by Nvidia to comply with tightened U.S. export restrictions implemented in October 2023. These rules ban the sale of the company’s most powerful chips—such as the A100 and H100—to China over national security concerns. The U.S. believes advanced AI chips could potentially be used to bolster China’s military capabilities.

Despite these restrictions, Nvidia is believed to have shipped around 1 million units of the H20 to China in 2024, generating over $12 billion in revenue.

Washington is also reportedly considering further limitations on even these lower-tier chips, raising the risk of additional constraints on China’s access to cutting-edge AI technologies.

. China’s Response and Domestic Alternatives
H3C is one of Nvidia’s key OEM partners in China, alongside Inspur, Lenovo, and xFusion—a spinoff from Huawei focused on x86 servers. The looming shortage could accelerate China’s efforts to develop and adopt domestic alternatives such as Huawei’s Ascend chips and Cambricon’s AI processors.

H3C’s internal communication reportedly emphasized a “profit-first” distribution model for upcoming chip deliveries, favoring long-term, high-margin customers. This signals that the chip shortage could hit smaller AI startups and new entrants the hardest, potentially reshaping China’s fast-evolving AI ecosystem.