China’s Anti-Monopoly Regulator Alleges Nvidia Violations
China’s State Administration for Market Regulation (SAMR) announced on Monday that Nvidia has preliminarily been found to have violated the country’s anti-monopoly laws. The findings relate to Nvidia’s 2020 acquisition of Mellanox Technologies, an Israeli company specializing in network solutions for data centers and servers.
The SAMR has not disclosed specifics of the alleged violations but confirmed the investigation will continue. Nvidia’s shares dropped approximately 2% in premarket trading following the announcement.
Context of the Mellanox Acquisition and Regulatory Scrutiny
China initially approved Nvidia’s $6.9 billion acquisition of Mellanox in 2020, imposing certain conditions at the time. The recent SAMR probe focuses on compliance with those conditions and broader anti-monopoly concerns. This investigation adds to the regulatory challenges Nvidia faces in China, one of its largest markets, especially for data center, gaming, and artificial intelligence products.
Wider Implications Amid US-China Tech Tensions
The announcement comes amid escalating tensions between Beijing and Washington over technology trade. Just days prior, China launched two separate investigations targeting US semiconductor imports and export restrictions affecting its chip industry.
These developments coincide with ongoing trade talks between the two nations in Madrid. The regulatory pressure on Nvidia could complicate negotiations and reflects China’s increasing efforts to control foreign tech influence.
Nvidia’s Position and Recent Developments
Nvidia has experienced turbulence in the Chinese market this year. Its H20 chip, designed to comply with US export rules, was blocked from shipment to China earlier in 2025. CEO Jensen Huang has advocated for continued access to the Chinese AI market, which he estimates could reach $50 billion within two to three years. He warned that absence of US firms would allow domestic companies like Huawei to dominate.
Last month, Nvidia reached an agreement with the US government allowing limited chip sales to China in exchange for surrendering 15% of related revenue to Washington. Discussions are also ongoing about permitting exports of more advanced chips to the Chinese market.
FinOracleAI — Market View
The SAMR’s preliminary ruling of Nvidia’s anti-monopoly law violation introduces regulatory uncertainty in one of Nvidia’s key growth markets. This news may weigh on investor sentiment given the potential for fines or operational restrictions, especially amid ongoing US-China trade tensions. Market participants should monitor further developments in the investigation and any regulatory actions resulting from it. Additionally, outcomes of the broader semiconductor probes and trade talks will be critical to Nvidia’s China strategy and revenue outlook.
Impact: negative
