Nvidia Shares Drop Amid Shock Antitrust Probe

The shares of stock market darling Nvidia have dropped by 2% in premarket trading following news of a Department of Justice (DOJ) antitrust investigation. This latest dip followed a more significant 10% drop during regular trading, which wiped nearly $279 billion from the company's market value. By Wednesday morning, Nvidia's stock was down 1.94%, continuing this decline.

The DOJ's probe focuses on Nvidia's dominant position in the AI chip market, particularly its role in the data center sector, where it holds over 80% of the market. The investigation aims to establish if Nvidia's practices limit customer access to alternative suppliers of AI chips. While no formal complaint has been issued yet, this scrutiny could reshape how the tech giant operates in a market it has dominated for years.

Nvidia's growth in recent years has been largely fueledby its leadership in AI chip development, particularly in data centers. A decade ago, the company developed CUDA, a programming language essential for training AI models. Nvidia's chips are now a key component in systems used by major cloud providers and tech giants, including Microsoft, Amazon, Meta, and Alphabet. 

Beyond hardware, Nvidia has expanded into enterprise software and networking products, moving from a chip supplier to a comprehensive systems provider. Despite the ongoing investigation, the company maintains its success is due to merit and performance. As of now, the DOJ has not commented on the future direction of the investigation.