Nvidia shares drop amid China antitrust probe

Nvidia’s shares fell in early Monday trading following reports that Chinese officials have launched an antitrust investigation into the dominant AI chipmaker.

Nvidia, which generates around 10% of its revenue from China-based customers, has found itself in the middle of an ongoing trade war between Washington and Beijing that continues to target high-tech chipmakers, News.az reports, citing foreign media.

Earlier this month, in fact, the Biden Administration issued its third export ban on China-bound exports, citing national security concerns, while officials in Beijing have urged domestic companies to avoid U.S.-made chips that they have deemed "no longer safe" in the current political environment.

The restrictions, which expand upon new export rules put in place in 2022 last year, are designed to limit China's access to "advanced semiconductors that could fuel breakthroughs in artificial intelligence and sophisticated computers that are critical to (Chinese) military applications," according to U.S. Trade Secretary Gina Raimondo.

Last year, Raimondo told CNBC that “the threat from China is large and growing" with respect to Beijing's ability to acquire AI technologies that could find their way into the military.

China ratcheted up that tech trade tension again Monday as the country's State Administration for Market Regulation launched an investigation into Nvidia tied to allegations it has breached anti-monopoly laws.

The government division said the probe was tied to Nvidia's $6.9 billion purchase of Mellanox Technologies Ltd, which it cleared in April of 2020.

News.Az