Nvidia’s Stock Dips As China Opens Probe Into Anti-Monopoly Violations

Shares of Nvidia fell early in the week after China announced an investigation into the company for suspected violations of Chinese anti-monopoly laws, Matt Ott and Sarah Parvini reported for the Associated Press (AP).

Nvidia, widely seen as a bellwether for artificial intelligence (AI) demand, has become one of the largest companies in the stock market. I Photo: NVIDIA AI Facebook

The probe reportedly focuses on Nvidia’s $6.9 billion acquisition of Mellanox Technologies in 2019, a network and data transmission company. Nvidia's stock dropped approximately 3% Monday, though it remains up 179% for the year.

Nvidia, widely seen as a bellwether for artificial intelligence (AI) demand, has become one of the largest companies in the stock market.

The AI boom has driven heavy investment in Nvidia's chips and data centers used for training and operating AI systems. Nvidia generates about 16% of its revenue from China, its second-largest market after the U.S., according to data from FactSet.

In a statement, a company spokesperson said Nvidia is “happy to answer any questions regulators may have about our business.”

In its most recent earnings release, Nvidia reported $35.08 billion in revenue, a 94% increase from $18.12 billion a year ago.

Profits also surged, with $19.31 billion posted in the latest quarter compared to $9.24 billion a year earlier. Nvidia’s market value recently hit $3.5 trillion, briefly surpassing Microsoft and Apple as the world’s most valuable company.