NVIDIA's (NASDAQ: NVDA) stock price dived after reports that China is investigating it for violations of its anti-monopoly laws. The move could impact NVIDIA’s business; China accounts for about 15% of the annual revenue, but how far is China willing to go? NVIDIA’s chips and CUDA framework are essential to harnessing AI power today; China’s investigation is more likely a warning than a real threat.
NVIDIA has competitors, and Advanced Micro Devices (NASDAQ: AMD) is one, but it is still in catch-up mode, leaving China with few options other than slapping NVIDIA on the wrist and letting it go about its business. As for who the warning is for, it’s questionable whether it was for NVIDIA, the United States Government, or both. The probe could be China’s retaliation for U.S. semiconductor sanctions, heightening tensions in the global semiconductor war.
