Dominari Financial CEO Kyle Wool analyzes the June PPI report and reacts to Big Techs worst decline since 2022 on Varney & Co.
Nvidia is facing calls for an antitrust investigation from Sen. Elizabeth Warren, D-Mass., and several progressive groups that take issue with the artificial intelligence (AI) powerhouse’s dominance of the AI chip market.
The AI giant controls about 80% of the market share and surging demand for AI pushed its market cap above $3 trillion for a time this summer. The remainder of the market is largely those rented by cloud computing firms like Google, Microsoft and Amazon Web Services that are rented to customers, and when those are excluded, Nvidia’s market share approaches 100%.
Warren and 10 progressive groups, including Demand Progress, sent a letter this week calling for Justice Department antitrust chief Jonathan Kanter to investigate Nvidia over its business practices. The groups expressed concern that Nvidia’s bundling of software and hardware products used in running complex models that train generative AI could undercut competition.
“This aggressively proprietary approach, which is strongly contrary to industry norms about collaboration and interoperability, acts to lock in customers and stifles innovation,” the groups wrote.
HOW NVIDIA BECAME THE KING CHIPMAKER, FROM A DENNY’S TO $2.3T MARKET CAP
Sen. Elizabeth Warren and progressives are taking issue with what they see as Nvidia’s outsized influence in the AI chip market. (Ting Shen/Bloomberg via Getty Images | Justin Sullivan / Getty Images)
“Allowing a single company to effectively be the gatekeeper for the world’s AI future is dangerous and poses dire economic risks,” Warren added in a statement to Reuters.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| NVDA | NVIDIA CORP. | 109.21 | -7.81 | -6.67% |
A spokesperson for Nvidia told in a statement that the company thinks the “regulatory system is working as intended, encouraging growth and investment in groundbreaking technologies” and noted its long-term investments in technologies that enable AI.
NVIDIA TOPPLES MICROSOFT AS WORLD’S MOST VALUABLE COMPANY
Nvidia CEO Jensen Huang shows off the company’s AI tech during a trade conference. (Justin Sullivan / Getty Images)
“As Moore’s law was coming to an end, we created an entirely new computing model, and invited researchers and scientists, developers, ecosystem partners, customers, and employees to explore what was once a zero-billion-dollar market with us,” the company said. “When we launched DGX1 and delivered the first AI supercomputer to OpenAI in 2016, few understood why we spent billions developing it.”
“Today, accelerated computing is sustainable computing. Every application that can be accelerated should be going forward, and we are committed to opening new markets and growth opportunities for our partner ecosystem. Regulators need not be concerned, as we scrupulously adhere to all laws and ensure that NVIDIA is openly available in every cloud and on-prem for every enterprise. We’ll continue to support aspiring innovators in every industry and market and are happy to provide any information regulators need,” Nvidia added.
WHAT IS ARTIFICIAL INTELLIGENCE (AI)?
Sen. Elizabeth Warren joined progressive groups in calling for an antitrust probe of Nvidia. (Chip Somodevilla / Getty Images)
A report by Reuters from June indicated that U.S. regulators reached a deal in which the Justice Department would oversee potential antitrust investigations of Nvidia, while the Federal Trade Commission would look at Microsoft and OpenAI.
Nvidia’s stock fell by more than 6% by early afternoon Thursday amid the news and a more modest selloff across the market that pared the S&P 500 by about 1.5%. Despite those headwinds, Nvidia’s stock is up over 127% year to date.
GET BUSINESS ON THE GO BY CLICKING HERE
Reuters contributed to this report.