Thursday, July 2nd 2020
NVIDIA Dismisses Investor Claims of $1 billion Wrongdoing in Company Finance Reporting Amidst Crypto Boom
NVIDIA has (not surprisingly) dismissed allegations that it had misled investors in regard to demand towards its GeForce graphics products circa 2017. The original allegation claimed that NVIDIA has wrongfully misrepresented GeForce division sales to investors by including crypto-focused sales on its bottom line. This, investors claim, painted a safer investment opportunity on NVIDIA stock than it actually was - the volatility of the crypto market and associated unpredictability in NVIDIA GeForce products' demand being the sore point for investors. Demand of GeForce products for gaming is considered to be less risk-averse and less elastic than crypto-focused sales.
NVIDIA says that investors cherry-picked corporate statements while ignoring others that, according to NVIDIA, showed transparency. The ammended class suit, which was amended in May 2020 from its original 2017 entry date, accuses Nvidia CEO Jensen Huang and Jeff Fisher, head of gaming, claiming they knew the rise in GeForce GPU sales was linked to the crypto mining boom and wasn't going to last in the long-term. NVIDIA says that executives didn't lie when they described crypto sales as a "small portion" of their revenue (which was disclosed at $6.9 billion for the year 2017). Another contention point from NVIDIA is that executives in the company (and the company itself) had no way of knowing ecactly what purpoze its sold GPUs were being put to.
NVIDIA says that investors cherry-picked corporate statements while ignoring others that, according to NVIDIA, showed transparency. The ammended class suit, which was amended in May 2020 from its original 2017 entry date, accuses Nvidia CEO Jensen Huang and Jeff Fisher, head of gaming, claiming they knew the rise in GeForce GPU sales was linked to the crypto mining boom and wasn't going to last in the long-term. NVIDIA says that executives didn't lie when they described crypto sales as a "small portion" of their revenue (which was disclosed at $6.9 billion for the year 2017). Another contention point from NVIDIA is that executives in the company (and the company itself) had no way of knowing ecactly what purpoze its sold GPUs were being put to.