NVIDIA Breaks Records By Losing $278 Billion In Market Cap Today, And A New Subpoena By The DOJ Only Adds To Investors’ Woes

Throughout today's regular trading session, investors continuously tried to determine the primary cause behind the relentless weakness in NVIDIA shares, one that saw the stock plunge by ~10 percent, erasing $278 billion in market capitalization and constituting a new record for any public company.

Some pointed to today's release of ISM manufacturing survey, which saw inventories climbing by most since the pandemic-driven disruption. Others pointed to lingering concerns over the company's peaking margins as it ramps up production of the Blackwell chips while still pushing the previous-gen Hopper series of chips through its sales channels.

As a refresher, while announcing its latest quarterly earnings, NVIDIA guided to a gross profit margin of 74.4 percent for the ongoing quarter, which was below not only the June-ending quarter's actual margin of 76.7 percent but also below that quarter's guidance of 74.8 percent.

Yet, the primary reason hit the airwaves just moments ago when Bloomberg disclosed that the US Department of Justice (DOJ) has formally subpoenaed NVIDIA over its ongoing antitrust probe against the company. A select clique of investors apparently knew of this development and was likely responsible for much of today's aberrant price action. If true, this should merit a dedicated investigation by the SEC.

Today's development comes after the DOJ and the FTC reportedly agreed on a formula back in August to divide the antitrust investigation workload vis-a-vis NVIDIA, Microsoft, and OpenAI between them, with the DOJ concentrating on NVIDIA alone while the FTC taking the lead on a broad-based antitrust probe against Microsoft and OpenAI.

Of course, the DOJ is likely to focus on NVIDIA's attempts to become a one-stop shop for all things AI, which not only includes dedicated AI accelerators such as the H100 and the upcoming GB200 chips but also software-based solutions to train AI models as well as data center design optimization services, which aligns with the "AI factory" vision of the GPU manufacturer's CEO, Jensen Huang.

Specifically, investigators are looking into NVIDIA's purported practice of giving preferential treatment in terms of pricing and/or supply to customers who use its AI chips exclusively or deploy the company's complete systems. Do note that Huang has previously stated that NVIDIA prioritizes customers who deploy its products within its designated ready-to-go data centers, presumably in a bid to deter stockpiling.

The DOJ is also probing NVIDIA's acquisition of the maker of AI computing software, RunAI. According to DOJ officials, this acquisition can make it more difficult for customers to switch away from NVIDIA's offerings.

Meanwhile, NVIDIA is refusing to cede ground at the moment, asserting that it "wins on merit" and that its customers "are free to choose" whatever solution serves as a best fit.

The post has been updated with additional details of the probe and NVIDIA's comments.

About the author: Writing is my one incontrovertible passion. Over the past six years, he has authored over 2,200 distinct articles on financial and tech-related topics, spanning nearly 1 million words. And he has been a member of Wcctech mobile team since 2025. As an alumnus of the University of Toronto, Rotman Commerce Program, I bring nuance, in-depth knowledge, and a unique perspective to every topic that I cover. When I'm not writing, I'm traveling the world, exploring hidden confectionaries and restaurants as an aspiring food connoisseur.

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