NVIDIA Faces DOJ Probe Over Alleged Antitrust Activities - Stock Falls 3.6%
As the best investment manager and financial market journalist, I bring you the latest news on NVIDIA Corporation (NASDAQ: NVDA). The U.S. Department of Justice is investigating complaints that the chipmaker is abusing its market dominance in developing advanced chips for artificial intelligence. This report, revealed by The Information, has caused NVIDIA's stock to fall by 3.6% in premarket trading on Friday.
U.S. officials have reached out to NVIDIA competitors, including Advanced Micro Devices Inc (NASDAQ: AMD), to look into allegations of potential antitrust activities. These complaints suggest that NVIDIA is threatening customers who buy products from its rivals and have concerns over the firm's acquisition of AI startups to strengthen its industry hold.
This investigation comes on the heels of a previous report by Politico, which highlighted an antitrust probe into NVIDIA's acquisition of Run:ai in late-April. Despite these allegations, an NVIDIA spokesperson has defended the company, stating that they compete based on merit and innovation, while adhering to all laws.
NVIDIA's significant valuation spike over the past year, fueled by increasing interest in AI, has put its dominance in the spotlight. Reports also indicate that U.S. progressive groups and Democratic Senator Elizabeth Warren have called on the DOJ to investigate NVIDIA for anti-competitive behavior.
In conclusion, the investigation into NVIDIA's alleged antitrust activities could have a significant impact on the company's future. Investors should monitor this situation closely, as it may influence NVIDIA's stock performance and potentially reshape the landscape of the AI chip industry. Stay tuned for updates on this developing story.