Nvidia (NASDAQ:NVDA) stock is a hot topic on Monday as watchdogs for the European Union (EU) are looking at the risk NVDA presents to the artificial intelligence (AI) market.
The EU’s competition watchdog is sizing up Nvidia and believes that it could present bottlenecks to the AI industry. The tech company is responsible for around 75% to 95% of AI chips used in the sector.
It’s worth pointing out that this doesn’t mean the regulator plans to take action against Nvidia. Instead, it’s currently asking preliminary questions ahead of any decision. This will help it determine if there’s even any action that needs to be taken.
Margrethe Vestager, EU’s competition chief, provided the following warning about Nvidia’s role in the AI market to Bloomberg:
“If you have that kind of dominant position in the marketplace, there are things that you cannot do that a small company can do. But other than that, as long as you do your business and are respecting that, you’re good.”
What This Means for NVDA Stock
Currently, NVDA investors have nothing to worry about from these statements. However, that could change if EU regulators decide that something needs to be done to relieve the company’s bottleneck.
NVDA stock has been unbothered by the regulator news today, with shares up by 1.6% this morning. The stock is also up 165.5% since the start of the year.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor held a LONG position in NVDA.
