According to sources, the DoJ is concerned that Nvidia may be making it difficult for customers to switch suppliers and could be penalising those who do not exclusively use its AI-optimized processors.

In response to the report, a spokesperson for Nvidia says that customers are free to “choose whatever solution is best for them,” highlighting that the company’s recent strong performance is a testament to its success based on merit.

This development follows a report last month from The Information, which revealed that the DoJ had initiated an investigation into potential competition issues at Nvidia after receiving complaints from its competitors.

The news comes on the heels of a sharp decline in Nvidia’s share price earlier this week, with the stock falling over 9% on Tuesday, wiping out approximately $279 billion in market value.

The sell-off has also impacted other major chip stocks, including AMD (NASDAQ: AMD), Intel (NASDAQ: INTC), and Broadcom (NASDAQ: AVGO), all of which experienced significant losses.