The Justice Department has fired off a subpoena to NVIDIA Corp. as part of a deepening antitrust investigation of the dominant AI chip maker.
Justice officials are also seeking evidence from other companies as part of the widening investigation, Bloomberg reported Tuesday, citing sources familiar with the matter. The DoJ had previously delivered questionnaires to NVIDIA, which commands more than 90% of its market, according to various market research reports, including a recent one from Futurum Intelligence.
Upon collecting information, the government would decide whether to launch a formal complaint. Investigators are specifically looking into whether NVIDIA is making it more difficult for customers to switch to other suppliers and if the company is punishing buyers that don’t exclusively use NVIDIA’s AI chips, the report said.
In recent weeks, federal regulators have been in contact with other tech companies to gather information, in an operation run out of the department’s San Francisco office, according to published reports. A focus of the growing probe is on NVIDIA’s April acquisition of RunAI, a maker of software for managing AI computing. They’re concerned the combination of the two companies will make it harder for customers to switch from NVIDIA chips.
NVIDIA has steadfastly maintained the quality of its products, which deliver faster performance, is the reason for its lofty standing over market rivals Advanced Micro Devices Inc., Arm Holdings, and Intel Corp.
“Nvidia wins on merit, as reflected in our benchmark results and value to customers, who can choose whatever solution is best for them,” the company said in a statement late Tuesday.
NVIDIA shares tumbled in extended trading Tuesday, following a record-setting rout that shaved $279 billion in market value earlier in the day, further softening optimism in the AI market. The company was already reeling from a quarterly earnings forecast last week that fell shy of investors’ outsized expectations.
Nonetheless, the company’s stock has more than doubled in 2024 on explosive sales growth.
NVIDIA is just the latest member of Big Tech to be scrutinized by the DoJ. Last month, the department won an antitrust case in federal court against Alphabet Inc.’s Google over its search business, and it is rumored to be looking into Apple Inc.
Meanwhile, the Federal Trade Commission and 17 states allege in a lawsuit nearly a year ago that Amazon.com Inc. uses anticompetitive and unfair strategies to block rivals and sellers, and raise prices and fees for consumers and businesses.
The FTC is also investigating OpenAI for possible violations of consumer protection law.
