Proactive Investors - NVIDIA Corp (NASDAQ:NVDA, ETR:NVD) is facing an antitrust probe from the US Department of Justice over allegations it has abused its market dominance in AI chips, according to a report from The Information.
US officials have reached out to several of Nvidia’s competitors, including Advanced Micro Devices (NASDAQ:AMD) Inc (NASDAQ:AMD, ETR:AMD) and AI chip startups, to collect information about the complaints, people involved in the discussion told the publication.
Allegations include that Nvidia has threatened to punish customers who buy products from its rivals by imposing higher prices on networking equipment for clients who purchase chips from competitors such as AMD or Intel Corp (NASDAQ:INTC, ETR:INL).
It is also alleged that Nvidia has pressured cloud service providers into purchasing multiple products together, such as A100 or H100 GPUs for AI and HPC workloads along with Mellanox-branded networking gear, limiting their choices.
Nvidia holds an estimated 80% share of the AI processor market.
The company did not comment on the report but told Reuters it would provide any information required to regulators.
"We compete based on decades of investment and innovation, scrupulously adhering to all laws, making Nvidia openly available in every cloud and on-prem for every enterprise, and ensuring that customers can choose whatever solution is best for them," a Nvidia spokesperson said in a statement.
Shares of Nvidia traded down 5.7% at about $103 in early trade on Friday amid a broader sell-off of tech stocks.