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BREAKINGVIEWS-Nvidia has nothing to fear but a lack of fear

Reuters09-05

(The author is a Reuters Breakingviews columnist. The opinions expressed are his own.)

By Robert Cyran

NEW YORK, Sept 4 (Reuters Breakingviews) - A sell-off in the $2.6 trln chipmaker’s shares, the third this year, has little basis in industrial reality. Customers still plan to spend billions on its chips. Fickle markets and antitrust probes are risks, but a bigger one is complacency – as modeled by forebearer Intel.

Full view will be published shortly.

Follow @rob_cyran on X

CONTEXT NEWS

Nvida’s stock fell 9.5% on Sept. 3, wiping around $380 billion off the U.S. chipmaker’s market capitalization.

The U.S. Department of Justice sent subpoenas to Nvidia and other companies to investigate whether the chipmaker violated antitrust laws, according to a Bloomberg story on Sept. 3, released after the market closed.

The DOJ is investigating whether Nvidia’s purchase of Run: ai, a software maker, will make it more difficult for customers to use other firm’s chips, and whether Nvidia gives preferential pricing and supply of chips to customers that use Nvidia technology exclusively, according to Bloomberg.

(Editing by John Foley and Pranav Kiran)

((For previous columns by the author, Reuters customers can click on robert.cyran@thomsonreuters.com))

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