Nvidia was fined $5.5 million for failing to adequately communicate to its shareholders that the growth of its gaming segment was largely explained by cryptocurrency mining.
Since the release of the new generation GeForces RTX cards from Nvidia, it is still hard for consumers to find graphics cards until a reasonable price† The reason is well known, among cryptocurrency miners and scalpers who presume graphics cards to resell them at a high price.
On the miners’ side, however, Nvidia had tried to reassure its investors a few years ago by stating that its division “gaming” had seen strong growth in its 2018 financial results. Despite this, Nvidia is now being accused of not providing its shareholders with sufficient information about the reasons for this growth.
This Friday, the SEC, the authority responsible for financial regulation in the United States, said: Nvidia fined $5.5 million (5.2 million euros). A fairly anecdotal figure for the American manufacturer as it represents only 0.02% of its turnover for the year 2021.
A lack of information communicated to shareholders
In detail, the SEC is criticizing Nvidia for failing to inform its shareholders that the sale of graphics cards to cryptocurrency miners represented a key element of its growth in fiscal 2018:
In consecutive quarters of fiscal 2018, the company failed to report cryptocurrency mining as a major part of its growth in sales of graphics cards designed and sold for gaming. […]† As the demand for and interest in cryptocurrencies grew in 2017, Nvidia customers increasingly used their gaming graphics cards for mining.
Since then, remember that Nvidia has launched several graphics cards specifically designed for cryptocurrency mining. This is the case of Nvidia CMP 30HX, 40HX, 50HX and 90HX† For example, these are not equipped with ports to which a screen can be connected and take advantage of specific mining tools. In addition, Nvidia has attempted to limit the use of some of its gaming GPUs in mining with software tools that prevent this type of use, such as on the Nvidia GeForce RTX 3060†
To follow us, we invite you to: download our Android and iOS app† You can read our articles, files and watch our latest YouTube videos.