By Aditya Soni and Deborah Mary Sophia (Reuters) -Days after Chinese upstart DeepSeek revealed a breakthrough in cheap AI computing that shook the U.S. technology industry, the chief executives of Microsoft and Meta defended massive spending that they said was key to staying competitive in the new field.

Chinese AI startup DeepSeek's model led to increased scrutiny on Microsoft's AI spending.

Reporting quarterly earnings Wednesday afternoon, it will be tough for Microsoft to avoid the issue of the AI breakthroughs from China's DeepSeek that are shaking up the tech world and the stock market this week.

DeepSeek’s AI breakthrough challenges Big Tech with a cheaper, efficient model. This may be bad for the incumbents, but good for everybody else.

The start-up had become a key player in the “Chinese Large-Model Technology Avengers Team” that would counter US AI dominance, said another. China’s delight, however, spelled pain for several giant US technology companies as investors questioned whether DeepSeek’s breakthrough undermined the case for their colossal spending on AI infrastructure.