Nvidia faces class action lawsuit amidst cryptocurrency fallout

Schall Law Firm is filing a class action lawsuit against Nvidia corporation, the world’s leading GPU maker, on the ground that it misled investors in expected finances.

According to the complaint, Nvidia misled its investors by overinflating its ability to monitor the cryptocurrency market and make business adjustments accordingly. The complaint alleges that Nvidia falsely claimed that any drop off in demand for its GPUs amongst cryptocurrency miners would impact business because of strong demand for GPUs from the gaming market.

Shall Law firm is encouraging investors who had lost more than $100,000 after purchasing Nvidia shares between Aug. 10, 2017 and Nov. 15, 2018 to contact the firm immediately.

It’s been long predicted that the inflated demand for cryptocurrency hardware was unsustainable. Some also attribute the sharp drop to the lackluster reception of the Nvidia Turing graphics cards.

According to Tweak Town, Its share price plunged from its $289.36 peak down to $144.70 on November 20, marking a market loss of $23 billion – the company’s all-time low in a decade.

Nvidia GeForce RTX 2080 Ti graphics card, the flagship consumer graphics card using the Turning GPU architecture. Source: Nvidia website

In a statement to VentureBeat, Nvidia claimed that its datacenter revenue was up 21 per cent and gaming revenue was up by 13 percent year-over-year.

Parick Moorhead of Moor Insights & strategy confirmed Nvidia’s good standing in datacenter and gaming to VentureBeat, but noted the slide in OEM and IP revenue.

“Nvidia had a really good Q3/19, revenue and profit-wise. The big revenue growth was in gaming, pro visualization (workstation), datacenter (ML, VDI), and auto (SD). The original equipment maker and intellectual property revenue was way down due primarily to cryptocurrency declines,” Moorhead said.

“Nvidia is saying there was a lot of Pascal inventory, likely due to over-ordering during the crypto-boom where gaming customers were ordering two to three times of what they needed to assure supply. This makes sense to me as AMD experienced the same phenomenon when they reported. I have no question that is a short-term [blip] that will be quickly corrected.”

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Jim Love, Chief Content Officer, IT World Canada

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Tom Li
Tom Li
Telecommunication and consumer hardware are Tom's main beats at IT Business. He loves to talk about Canada's network infrastructure, semiconductor products, and of course, anything hot and new in the consumer technology space. You'll also occasionally see his name appended to articles on cloud, security, and SaaS-related news. If you're ever up for a lengthy discussion about the nuances of each of the above sectors or have an upcoming product that people will love, feel free to drop him a line at tli@itwc.ca.

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