Nvidia investor class-action suit advances over crypto mining revenue

A California judge has certified an investor class in the Nvidia securities suit over alleged misstatements on crypto mining GPU sales, advancing the case toward a potential trial.

A California federal judge has certified an investor class in a securities lawsuit accusing Nvidia and CEO Jensen Huang of misleading shareholders about how much of the company’s gaming revenue during the 2017-2018 crypto mining boom came from GPU sales to cryptocurrency miners.

US District Judge Haywood S. Gilliam Jr. ruled in a March 25 order that investors can pursue their claims as a group, while stressing that class certification is a procedural step and does not resolve the question of whether Nvidia’s statements were fraudulent.

The order defines the class as investors who bought Nvidia stock between Aug. 10, 2017, and Nov. 15, 2018, and focuses heavily on “price impact” and whether the alleged misstatements affected Nvidia’s share price. 

In 2022, Nvidia agreed to pay a $5.5 million penalty and accept a cease-and-desist order over inadequate disclosures tied to crypto mining’s impact on its gaming GPU business, and the US Supreme Court in December 2024 left in place a Ninth Circuit ruling that allowed the shareholder suit to proceed.

Judge certifies Nvidia investor class

The shareholders allege that the chipmaker and Huang misled the market about how much of its surging gaming revenue came from graphics processing unit (GPU) sales to cryptocurrency miners.

They claim the truth began to emerge after Nvidia’s Aug. 16, 2018 earnings call and guidance cut, when the stock fell about 4.9%, and again following a further revenue warning on Nov. 15, 2018, when shares dropped roughly 28.5% over two trading days.