NVDA Stock Alert: France confirms Nvidia faces antitrust investigation

A French antitrust authority confirmed an investigation into NVIDIA (NASDAQ:NVDA). According to the Autorité de la concurrence, artificial intelligence (AI) boss may face charges if he is found guilty of anti-competitive practices.

This news follows a report from July 2 by Reuters This suggested that antitrust proceedings against Nvidia were likely. Now NVDA stock is fluctuating today on the news that the agency is continuing this investigation.

If the company is sued, this could have a negative impact on Nvidia’s share price. So far, however, the market does not seem too concerned about this development.

What is happening with NVDA stock?

Despite the drop at today’s open, NVDA stock has since reversed course and is slowly trending higher. While still down, the stock has recovered despite some volatility and could turn positive by the close, even as news of the investigation continues to trend.

While this investigation into Nvidia is certainly not good news, it is not necessarily a reason for investors to panic. NVDA stock remains one of the strongest performing stocks on the market and the company has a lot to offer. Even if Nvidia is found guilty of anti-competitive practices, demand for its products will not disappear. InvestorPlace Contributor Chris Markoch reports:

“Companies from all industries are racing to develop artificial intelligence (AI) applications. And NVIDIA develops the hardware that those companies need for those applications. For the past 18 months, investors have largely dismissed their concerns about a high valuation. And for the most part, the company has delivered revenue and earnings outlooks that reassure them. Investors expect more of the same, and that’s why this report will be an exciting one.”

In fact, Nvidia has been a very consistent performer, gaining more than 125% over the past six months. While the company is still recovering from its recent stock split, it is well positioned to continue making progress toward returning to previous levels.

Why it is important

As always, it’s important for investors to look beyond the headlines and see the bigger picture when it comes to NVDA stock. For now, this picture shows that Nvidia is not discouraged by the news of the investigation. This suggests that even if the investigation gets more heated, NVDA will not falter too much and will ultimately overcome the turmoil. Many leading technology companies have faced regulatory investigations before and managed to recover well. There’s no immediate reason to believe it will be any different this time.

As of the date of publication, Samuel O’Brient held a LONG position in NVDA. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s disclosure policies.

At the time of publication, the responsible editor had no (direct or indirect) positions in the securities mentioned in this article..