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Vistra Corp: DeepSeek Challenging the AI-Power Demand Thesis Could Be A MATTER OF CONCERN!

The emergence of DeepSeek, a Chinese artificial intelligence startup, has sent shockwaves across Wall Street, and energy companies are feeling the aftershocks. Vistra Energy suffered its worst single-day decline ever, plunging 28% on January 29, 2025, shedding a staggering $18.4 billion in market value. Constellation Energy (NASDAQ: CEG) also nosedived by 21%, erasing $22.8 billion in capitalization. While these stocks have partially rebounded, a deeper concern lingers—has DeepSeek fundamentally altered the bullish thesis that AI will drive exponential power demand? Wall Street had long viewed AI as a relentless consumer of electricity, fueling a surge in independent power producer (IPP) stocks. However, DeepSeek’s ability to run sophisticated AI models with significantly lower energy consumption has cast doubt on these assumptions. If AI can evolve to require far less power, then Vistra, Constellation, and other power providers could see a long-term dampening of their growth prospects. Here are three critical reasons why the DeepSeek effect could continue to weigh on Vistra’s future.

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