NVIDIA shares, NVDA, fell 7% on Thursday after a US federal judge allowed an investor lawsuit to proceed as a class action, reviving allegations that the company and CEO Jensen Huang concealed more than $1 billion in crypto-mining–related graphics card sales.
NVIDIA Accused Of Hiding $1 Billion In Crypto Sales
The suit, originally filed in 2018, contends that NVIDIA misled shareholders by attributing surging revenue to gaming demand while minimizing the substantial contribution from cryptocurrency miners.
Plaintiffs maintain that the company funneled orders from miners through consumer GeForce gaming cards rather than reporting them under dedicated crypto product lines, inflating the appearance of organic gaming growth.
Related Reading
According to internal testimony and documents disclosed in the court filing, independent analyses place undisclosed crypto-related GPU revenue between $1.1 billion and $1.35 billion—far exceeding what NVIDIA publicly acknowledged at the time.
In court materials, one insider identified as “FE 1” explained how the tracking system monitored miner purchases; another, “FE 2,” said Huang participated in sales meetings where crypto-driven demand and its effects on revenue were discussed.
Plaintiffs argue these accounts, together with internal records, show NVIDIA was aware of the scale of miner demand but publicly downplayed its significance.
Class Action Certified Despite Company Defense
NVIDIA has long maintained that crypto mining accounted for only a small fraction of its business and that any mining-related exposure was largely confined to dedicated Crypto SKUs within its OEM segment.
NVIDIA’s defense has drawn backing from industry groups: in August 2024, the Digital Chamber of Commerce filed an amicus brief urging the US Supreme Court to overturn a Ninth Circuit decision that had partially revived the case.
Regulators have previously sanctioned NVIDIA over related disclosure issues. In 2022, the Securities and Exchange Commission (SEC) fined the company $5.5 million and issued a cease-and-desist order for allegedly failing to fully disclose how crypto-mining demand affected fiscal 2018 results.
Despite that settlement, plaintiffs say the newly surfaced internal emails and testimony support their contention that NVIDIA’s public statements materially mischaracterized the drivers of its 2018 revenue.
Related Reading
The alleged concealment had real market consequences: when cryptocurrency prices collapsed in late 2018, and miner demand evaporated, NVIDIA sharply lowered its revenue guidance, citing excess inventory and weaker miner orders.
The stock plunged over two trading days, precipitating the investor suit that has now been certified as a class action by Judge Haywood S. Gilliam Jr. Judge Gilliam reached the certification after NVIDIA failed to demonstrate that its statements had no impact on the company’s stock price.
Court filings also include an internal email from a senior vice president that suggested NVIDIA’s valuation remained elevated because of the company’s public reassurances—an item plaintiffs point to as evidence of market effect.
At the time of writing, NVDA was trading at $172, down almost 18% from its all-time high of $212 set in October of last year.
Featured image from CNBC, chart from TradingView.com
