Cykel AI shares surge on DeepSeek R1 integration

(Sharecast News) - Shares in Cykel AI surged on Wednesday after the company wasted no time in integrating the hyped DeepSeek R1 open-source large language model across its digital worker platform, which it says will cut future AI infrastructure costs by up to 96%.

The news came just days after DeepSeek launched its breakthrough LLM, which caused a huge sell-off across the US-listed AI sector. Investors have voiced concerns that the Chinese firm is producing comparable technology at a fraction of the cost of what others like Microsoft and Google have spent.

For London-listed Cykel AI, which creates so-called "digital workers" to perform complex business tasks like candidate sourcing in recruitment, DeepSeek R1 costs just 4% of comparable model rates while matching or exceeding their performance.

According to co-founder and chief executive Ewan Collinge, the cost reduction will unlock entirely new use cases for its digital workers.

"Just as cloud computing made processing power abundant and fundamentally transformed software, DeepSeek R1 makes AI reasoning abundant and will transform digital workers. [...] While this development is disruptive to closed-source LLM and hardware providers, for application layer companies like Cykel, this is a major step towards abundant, affordable intelligence that we can deploy through our agents."

The stock was up 23% at 3.64p by 1118 GMT, having slumped earlier in the week in line with the wider AI sector.