(Credit: Bloomberg/Contributor via Getty Images)
Nvidia is now facing two investigations from the US Department of Justice over its AI practices, according to new reports published Thursday night.
One of the investigations is examining whether Nvidia might have violated any US antitrust laws with its $700 million April acquisition of Israeli AI startup Run:AI, Politico reports, citing five unnamed sources familiar with the probe.
The second DOJ investigation is looking into Nvidia's status as a dominating force in the chips market in response to complaints from competitors, The Information reports. This is also an antitrust investigation, but will additionally determine whether Nvidia unfairly pressured cloud computing firms and will look into whether Nvidia overcharged customers for its hardware if they opted for a rival's chips.
Reached for comment on the investigations, an Nvidia representative tells PCMag: "Nvidia wins on merit, as reflected in our benchmark results and value to customers. 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. We’ll continue to support aspiring innovators in every industry and market and are happy to provide any information regulators need."
France's competition authority confirmed this month that it's investigating Nvidia over alleged anticompetitive practices as well. The French authority's president has said that charges will be pressed "if the investigation is fruitful," Reuters previously reported.
Nvidia, which has a staggering market capitalization of $2.38 trillion at time of writing, saw its stock price fall over 6.5% early Friday. By comparison, AMD's market cap sits at a little over $205 billion, and Intel's market cap is approximately $121 billion. In June, Nvidia briefly surpassed Microsoft's market cap. Now, Nvidia is the third-largest company in the world after Apple and Microsoft.
It's currently unclear whether these DOJ investigations will be combined into one lawsuit if the US decides to escalate the situation. Earlier this year, the DOJ sued Apple over alleged antitrust violations, arguing that Apple's dominance and practices have made it difficult for competitors to operate on Apple devices. Google is also waiting on the resolution from its four-year antitrust trial. The DOJ filed a lawsuit against Google back in 2020, and the closing arguments for the case were made in May of this year. It then sued Google again last year over its ad tech.
PCMag has reached out to the DOJ for comment.