Nvidia, the world's leading manufacturer of AI-specific computer chips, experienced its most significant single-day loss in market capitalization on September 3, 2024.
Nvidia, the world's leading manufacturer of AI-specific computer chips, experienced its most significant single-day loss in market capitalization on September 3, 2024. The tech giant saw over $280 billion wiped from its value following reports of an antitrust subpoena issued by the United States Department of Justice (DOJ).
Nvidia's shares plummeted 9.53%, closing at $108, and continued to slide in after-hours trading, losing a further 2.42% to reach a low of $105. This unprecedented $278 billion loss in market value marks the largest single-day decline for any stock in U.S. market history.
The catalyst for this dramatic downturn was a Bloomberg report revealing that the DOJ had served Nvidia and several other companies with subpoenas as part of an ongoing antitrust investigation. This legal action represents an escalation from previous non-binding questionnaires, suggesting that the government may be preparing to file a formal complaint against the chipmaker.
At the heart of the DOJ's concerns are allegations that Nvidia might be engaging in practices that make it challenging for businesses to switch to other AI and computer chip providers. There are also suggestions that the company may have penalized buyers who don't exclusively use its AI services.
As part of its probe, the DOJ has reportedly reached out to other tech firms, including Microsoft, Nvidia's largest investor, for additional information. Nvidia CEO Jensen Huang has defended the company's practices, explaining that priority is given to customers who utilize Nvidia products in ready-to-go data centers. Huang maintains that this approach is designed to prevent stockpiling and accelerate the deployment of Nvidia's technology.
Crypto AI tokens experienced a significant decline, amidst a wider market rout. Near Protocol (NEAR) fell 7.1% in the past 24 hours, while Artificial Superintelligence Alliance (FET) declined by 7.5%.
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