Nvidia reportedly raided by French antitrust authorities

29 Sep 2023

Image: © JHVEPhoto/Stock.adobe.com

Nvidia has seen a massive surge in growth this year from its AI focus, which may have gained the attention of French authorities.

A graphics card company has been raided by French authorities and media sites are pointing the finger at Nvidia.

France’s national competition regulator said an unannounced visit and seizure operation was carried out earlier this week on a company in the graphics card sector. The regulator claimed this company is suspected of implementing “anticompetitive practices”.

The raid is linked to a broader focus on the cloud computing sector, the regulator said. This links back to a report in June that said Microsoft, Google and Amazon Web Services (AWS) dominate the sector and potentially hinder competition.

The Wall Street Journal reported that Nvidia was the target of the raid – according to people familiar with the matter – while a French media site also reported that the raid hit a Nvidia office.

The French authority said the raid does not prejudge the guilt of the raided company, as only an investigation would confirm if alleged anticompetitive practices took place. The regulator also said it would not comment on the identity of the company.

An investigation into Nvidia would be unsurprising, given its recent surge in valuation amid the AI rush being witnessed across the global tech sector.

Nvidia broke the $1trn valuation earlier this year, largely driven by its decision to go all in on AI tech. The company provides chips that are used for various generative AI models, including OpenAI’s ChatGPT.

The company’s data centre business has also grown significantly. In its second fiscal quarter for 2023, this business alone brought in $10.32bn, which was 140pc higher than the previous quarter and up 171pc over the same period last year.

In May, Nvidia revealed it is building a new supercomputer that will help companies develop generative AI models.

“Generative AI, large language models and recommender systems are the digital engines of the modern economy,” Nvidia co-founder and CEO Jensen Huang said at the time.

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Leigh Mc Gowran is a journalist with Silicon Republic

editorial@siliconrepublic.com