Tech experts seemed to downplay Chinese regulators’ investigation into Nvidia Corp (NASDAQ:NVDA) over an alleged breach of antitrust regulations.
What Happened: The Chinese State Administration for Market Regulation claims that the Santa Clara, California-based company violated its obligations while acquiring Mellanox Technologies in 2020.
The news comes amid President-elect Donald Trump‘s continued insinuations that he will raise tariffs against Chinese goods. Domestic importers pay tariffs by passing the burden to consumers via price hikes.
“Zero surprises here that $NVDA is being investigated in China,” analyst Patrick Moorhead said on X. “Comes with the 90+% market territory in a vital commodity. These things take 5-10 years to sort through. Quicker in China, but still very slow. All regions will be investigating Nvidia on datacenter GPUs at some point.”
Industry analyst Daniel Newman shared a similar sentiment, adding that any allegations of anti-competitive behavior are unfounded.
“There is no meaningful proof to date that Nvidia is abusing its dominant market position or its competitive advantage to stifle competition or harm consumers,” Newman said. “There have been anecdotal stories that have floated around, but at this point, it is all speculative.”
Angela Zhang, a law professor at the University of Southern California, said that China may “weaponize” antitrust against the U.S.
“When I wrote ‘Chinese Antitrust Exceptionalism’, I explained how antitrust law can be wielded as a weapon against U.S. sanctions and restrictions,” Zhang posted on X. “Over the past few years, we've seen this play out repeatedly as the U.S. doubles down on its AI chip embargo on China. Nvidia seems to be the latest example.”
Price Action: Shares of Nvidia fell nearly 3% following the news on Monday.
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