Nvidia receives DOJ subpoena in antitrust probe: Bloomberg
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The news: The US Department of Justice has sent subpoenas to Nvidia and other companies as part of its investigation into the chipmaker's antitrust practices, Bloomberg reported, citing people familiar with the investigation.
The numbers: Nvidia shares suffered a record-setting rout overnight, falling 9.53%, and were down a further 1.65% by 8am AEST in after-hours trading on the Nasdaq.
Last week, Nvidia's shares slumped despite the company's Q2 earnings beating market forecasts, notching record revenue of USD30 billion ($44 billion), representing a 122% increase year on year and a 15% increase from the previous quarter.
The context: The DOJ had previously delivered questionnaires to the companies, including Nvidia, and is now sending legally binding requests that oblige recipients to provide information.
Antitrust officials are concerned that Nvidia is making it harder to switch to other suppliers and penalises buyers that do not exclusively use its artificial intelligence chips, according to the unnamed sources.
In June, the DOJ and the US Federal Trade Commission agreed to proceed with antitrust investigations into the roles Microsoft, OpenAI and Nvidia play in the artificial intelligence industry. As part of the deal, the DOJ agreed to lead an investigation into whether the behaviour of Nvidia had violated antitrust laws.
In recent weeks, US officials have reached out to a number of Nvidia's competitors to gather information about the complaints, with allegations ranging from claims that Nvidia has threatened to punish customers who also buy products from its competitors, to concerns about its acquisition of startups that strengthen its grip on the software AI developers use.
The source: Bloomberg
