China has initiated an antitrust investigation into Nvidia, scrutinizing its acquisition of Mellanox Technologies. This move comes as US export restrictions hinder Nvidia from supplying its most advanced AI chips to China, benefiting domestic competitors like Huawei. The investigation echoes previous actions against Qualcomm, which resulted in a hefty fine.
Facing these challenges, Nvidia's revenues from China have dwindled from 26% to 17% over two years, due to the US's curbs on semiconductor exports. This has prompted Nvidia to develop China-specific chips and explore manufacturing options in the US to safeguard its market position.
China's State Administration for Market Regulation (SAMR) has not detailed Nvidia's alleged violations, but the probe impacts Nvidia's shares, which fell over 2%. The US-China trade tensions are further exacerbated by China's ban on critical mineral exports, as industry groups push for buying local chips. Nvidia remains tight-lipped about the investigation, but CEO Jensen Huang has expressed a willingness to support US policies on China trade. As the AI boom continues, Nvidia must navigate these geopolitical and competitive pressures to maintain its foothold in the global market.
