Nvidia receives DOJ subpoena

After an AI report led to the largest single-day decline (9.5%) in Nvidia’s stock history and wiped $279 billion from its market value on Tuesday, Bloomberg reported that the Department of Justice subpoenaed the world’s leading chipmaker as it investigates if the company violated antitrust laws.

It is an escalation of the DOJ’s probe into whether Nvidia unfairly maintains its AI dominance.

Yesterday, the chipmaker denied reports that it received a subpoena. However, its stock fell a bit more as investors are concerned about the US economy and skepticism about the high valuations of AI companies.

It marks a rough period for Nvidia, which hit a $3 trillion market cap in June, briefly making it the world’s most valuable company.

Despite the setback, Nvidia’s stock is still up 118% this year, with a market valuation of $2.7 trillion. CEO Jensen Huang remains optimistic, stating that demand for Nvidia’s AI chips far exceeds supply and that their technology offers immediate returns for investors.

Nivdia’s clients include Microsoft, Meta, OpenAI, Apple, and others. Part of the DOJ investigation includes determining if the chipmaker plays favorites among clients and penalizes companies that don’t exclusively use its AI chips.