The US Securities and Exchange Commission (SEC) has fined NVIDIA for "inadequate disclosures" about the impact of cryptocurrency mining on the company's gaming business. According to a press release, the watchdog has reached a settlement with NVIDIA ordering it to a $5.5 million fine.
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The SEC says that during consecutive quarters in NVIDIA's fiscal year 2018, the company "failed to disclose that cryptomining was a significant element of its material revenue growth from the sale of its graphics processing units designed and marketed for gaming." Back at the time, NVIDIA reported "material growth in revenue" referring to its gaming business. However, in reality, NVIDIA had information, that the increase in sales was actually driven "in significant part" by cryptocurrency mining.
"Despite this, NVIDIA did not disclose in its Forms 10-Q, as it was required to do, these significant earnings and cash flow fluctuations related to a volatile business for investors to ascertain the likelihood that past performance was indicative of future performance."
In March 2018, NVIDIA CEO Jensen Huang blamed ether (ETH) miners for the shortage of GPUs. Speaking to a group of journalists following his keynote address at NVIDIA's GTC conference, Huang said that Nvidia was not in the business of cryptocurrency or distributed ledgers.
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