The booming AI chipmaker has been facing increasing regulatory scrutiny on both sides of the Atlantic.
The US Department of Justice is investigating complaints made against Nvidia by its competitors alleging that the AI chipmaker is actively stifling competition in the chips market.
Nvidia, which has grown in leaps and bounds in recent months and is now the world’s third most valuable company by market cap, has been providing the bulk of the powerful chips needed to develop generative AI models.
But the company led by CEO Jensen Huang is alleged to have abused its market dominance by threatening to punish customers who buy products from its competitors, according to a report by The Information. People familiar with the matter told the publication that US antitrust officials have spoken to Nvidia competitors such as AMD and a number of AI start-ups.
Regulators are also reportedly concerned about the number of AI start-ups being acquired by Nvidia to strengthen its grip on the software used by AI developers, Politico reports.
Nvidia has been under regulatory scrutiny for a while now. In June, reports suggested that Nvidia was one of three major players in the AI space – the other two being Microsoft and OpenAI – that were set to be subject to federal antitrust investigations in the US.
People familiar with the matter told The New York Times at the time that the US Department of Justice and the Federal Trade Commission (FTC) struck a deal to divvy up the investigations of potential anticompetitive behaviour among the three companies.
The report suggested that the Department of Justice was to take the lead on investigating Nvidia under antitrust laws while the FTC was to look into deals struck between Microsoft and OpenAI, valued in the billions.
Less than a month later, Nvidia was in trouble across the Atlantic as French regulators began preparing to charge the company for breaking competition laws in the country.
The chipmaker was reportedly raided by French authorities last September in an unannounced visit and seizure operation after suspicions that it was implementing “anticompetitive practices”.
The raid was linked to a broader focus on the cloud computing sector, the regulator said. This linked back to a report from a year ago that said Microsoft, Google and Amazon Web Services dominated the sector and potentially hindered competition at the time.
In its most recent earnings, Nvidia reported record quarterly revenue of $26bn – marking an 18pc increase over the previous quarter and a 262pc increase over the same period last year. Net income shot up too, going from $2bn a year ago to nearly $15bn.
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