Court Certifies Investor Class in Nvidia Securities Case
A U.S. federal judge has allowed a group of investors to move forward together in a class-action lawsuit against Nvidia and its CEO Jensen Huang. The case centers on claims that the company misled shareholders about how much of its gaming revenue during the 2017–2018 crypto boom came from GPU sales to cryptocurrency miners.
On March 25, U.S. District Judge Haywood S. Gilliam Jr. ruled that investors who purchased Nvidia stock between August 10, 2017, and November 15, 2018, can proceed as a certified class. This decision allows the case to advance toward trial, although the judge clarified that certification does not determine whether Nvidia actually committed fraud.
The ruling focuses heavily on whether Nvidia’s alleged misstatements had a direct impact on its stock price. Investors argue that the company did not fully disclose how dependent its gaming segment was on crypto-related GPU demand during the height of the mining boom.
Allegations Focus on Crypto Revenue Disclosure and Stock Impact
Shareholders claim Nvidia downplayed over $1 billion in revenue tied to cryptocurrency mining, giving investors a misleading picture of the sustainability of its gaming business. According to the lawsuit, the truth began to surface in 2018.
After an earnings call on August 16, 2018, and a revised financial outlook, Nvidia’s stock reportedly dropped around 4.9%. Later, on November 15, 2018, a further revenue warning led to a sharper decline of about 28.5% over two trading sessions.
The lawsuit was first filed in 2018 and later amended in 2020. It gained further momentum after the U.S. Supreme Court declined to block the case in 2024, allowing it to proceed.
Separately, Nvidia had already agreed in 2022 to pay a $5.5 million penalty and comply with a cease-and-desist order related to inadequate disclosures about crypto mining’s effect on its GPU sales.
Nvidia has responded by stating that investors from that period have ultimately benefited from the company’s long-term strategy and that it plans to defend itself in court.
The judge also allowed the plaintiffs to use an “out-of-pocket” damages model along with a statistical event study that analyzes how Nvidia’s stock reacted to key disclosures.
