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After rumors of a U.S. Department of Justice (DOJ) antitrust subpoena, Nvidia has seen its biggest single-day market capitalization drop, wiping out around $278 billion in value. Based on Google Finance data, on September 3 Nvidia’s shares fell 9.5% to $108—the worst value decrease any company in American market history has ever recorded. For after-hours trade, shares kept declining by more than 2% to $105.
Notable drop followed news that the DOJ has enlarged its investigation against Nvidia via a subpoena, therefore suggesting a likely infringement of U.S. antitrust laws. Bloomberg claims that as part of the government’s probe on their supremacy in the AI chip market, Nvidia and a few other firms got subpoenas.
The DOJ sent Nvidia non-binding information-based questionnaires prior to the subpoena. But the subpoena authorizes Nvidia to legally hand over particular data, suggesting that the government could be getting ready to officially sue the chipmaker.
Antitrust authorities worry that by making it harder for companies to switch to rival artificial intelligence and computer chip suppliers, Nvidia is thereby lowering the competitiveness. Moreover, there are allegations the business punished consumers depending more on other items than just those based on artificial intelligence. The DOJ apparently is gathering more data from technology corporations, including Microsoft, the biggest Nvidia investment.
Defining its business plans in a statement to Bloomberg, Nvidia claimed to succeed on merit based on better customer value and product performance. Customers that employ Nvidia products in ready-to-go data centers have priority, CEO Jensen Huang said, which helps reduce hoarding and simplifies installation.
Originally started in 1993, Nvidia has developed to be well ahead of other chipmakers in terms of leading CPU manufacturer utilized in artificial intelligence applications. With a market value of $2.65 trillion at printing, Nvidia was 30 times bigger than rival AMD and 30 times more valuable than Intel.
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