Nvidia gets subpoena from US Department of Justice
Last month, the DoJ launched a probe into the company after competitors complained that it had abused its market dominance.
The U.S. Department of Justice (DoJ) has sent a subpoena to Nvidia, signaling a deepening probe into the company’s antitrust practices, Bloomberg reports.
U.S. officials are reportedly concerned that the tech and AI chip giant is making it tougher to switch to other suppliers and penalizes buyers that do not exclusively use its AI chips.
DoJ lawyers had previously sent questionnaires to multiple businesses, but the subpoenas delivered to Nvidia and other tech firms can potentially bring the investigation closer to a lawsuit, according to the Bloomberg report.
“Nvidia wins on merit, as reflected in our benchmark results and value to customers, who can choose whatever solution is best for them,” a spokesperson for the company said.
Last month, the DoJ launched a probe into the company after competitors complained that it had abused its market dominance.
Nvidia said last week it has received requests for information from U.S. and South Korean regulators regarding its investments, partnerships and agreements with other companies, according to Reuters.
Politico reports that Justice Department lawyers are also looking into Nvidia’s purchase of Run:ai, a firm that allows computer chips to operate more efficiently.
Meanwhile, the U.S. Federal Trade Commission is investigating whether Microsoft and OpenAI violated antitrust laws through their partnership. OpenAI uses Nvidia chips to train large language models that are a critical part of its products such as ChatGPT.
Nvidia lost USD 279 billion in market capitalization on Tuesday as the shares of the chipmaking giant dropped by a whopping 9.5%, the sharpest single-day decline in market value for a U.S. company. The dramatic fall in shares is being attributed to dampened investor optimism about the boom in AI.
Nvidia’s quarterly forecast did not meet lofty investor expectations. Though the company posted a 122% increase in second-quarter revenues compared with the same period last year, investors are worried about its slowing growth and production issues.
