Investor Guide: The Hidden Legal Issues That Will Undercut Nvidia's Share Price

Nvidia is powering global AI revolution, but beneath the infrastructure are legal battles, global risks, and hidden investor opportunities.

Nvidia products are being utilized by many global organisations for AI infrastructure. Behind its meteoric rise lies a complex web of legal risks, from antitrust investigations to export bans that could shake its future outlook. At the same time, Nvidia’s dominance in AI chips offers massive rewards for investors who understand what is really at stake. In this deep dive, we break down the biggest legal forces impacting Nvidia’s future, and what they mean for your money as an investor.

Is Nvidia Really a Safe Bet for Retail Investors?

Nvidia’s meteoric rise in the age of artificial intelligence has created extraordinary opportunities for investors, and a tangle of legal and regulatory questions. The company sits at the intersection of surging demand for AI chips and intensifying scrutiny from governments worldwide.

In this deep dive, we explore eight key themes that combine both the growth rewards and the legal risks of investing in Nvidia. Each theme highlights a specific area of Nvidia’s expansion offering potential returns, paired with a critical analysis of the associated legal or regulatory risks from the U.S. and international markets.

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Nvidia has become synonymous with the AI revolution, powering everything from advanced research labs to popular consumer tools like ChatGPT. In 2023–2024, surging demand for Nvidia’s AI chips sent its stock and valuation into the stratosphere. The company’s market capitalization briefly topped $2 trillion in early 2024, less than nine months after it first crossed the $1 trillion mark. In one record-breaking day, Nvidia’s value jumped by $277 billion following a blockbuster earnings report, the largest single-day gain in Wall Street history.

Such eye-popping figures illustrate why many retail investors are captivated by Nvidia’s growth story and its dominant position in artificial intelligence. However, alongside these rewards lie serious legal and regulatory risks that could impact Nvidia’s future.

U.S. and European authorities are scrutinizing the company’s market power, international trade tensions threaten key markets, and Nvidia’s heavy reliance on certain suppliers presents strategic vulnerabilities.

This deep dive will break down why Nvidia dominates the AI chip market, examine the legal risks that could affect its valuation, explore the growth prospects and rewards for investors, and offer practical guidance on how to evaluate Nvidia’s risks and rewards.

1. AI Data Center Gold Rush vs. Regulatory Scrutiny

Nvidia’s data centre business is booming on the back of an AI gold rush. The company’s GPUs have become essential for training large-scale machine learning models, driving unprecedented revenue growth. In the first quarter of fiscal 2025 alone (Feb–Apr 2024), Nvidia reported a record $26 billion in revenue, up 262% year-on-year, with its data centre segment contributing $22.6 billion, about 87% of total revenue.

This surge, fuelled by demand for AI acceleration in cloud computing, has made Nvidia the de facto supplier for “AI factories” in tech giants and enterprises alike. Such dominance positions investors for handsome rewards as Nvidia’s chips become the picks and shovels of the AI revolution.

The company’s annual sales more than doubled from $27 billion in 2023 to $60.9 billion in 2024, and are projected to more than double again to roughly $130 billion in 2025, explosive growth by any measure.

Yet the very scale of this success is drawing regulatory scrutiny. When one company commands an outsized share of a critical tech market, lawmakers take notice. In Nvidia’s case, its near-monopoly in high-end AI GPUs, an estimated 84% market share, far ahead of competitors, has prompted questions from antitrust authorities around the world. U.S. regulators have kept an eye on Nvidia’s market power, the FTC famously intervened to block its attempted ARM acquisition: more on that later, and now EU regulators have launched inquiries into Nvidia’s business practices.