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Nvidia Corp (NASDAQ: NVDA) has agreed to pay a $5.5 million penalty for failing to adequately disclose the impact of crypto mining on the company’s gaming business.
A Securities and Exchange Commission (SEC) filing stated that the company failed to disclose that crypto mining was a significant element of its material revenue growth from the sale of its gaming chips, during consecutive quarters in NVIDIA’s fiscal year 2018.
The firm, which did not admit or deny the SEC's findings, agreed to pay a civil penalty of $5.5 million.
Impact of non-disclosure
“The SEC’s order also finds that NVIDIA’s omissions of material information about the growth of its gaming business were misleading given that NVIDIA did make statements about how other parts of the company’s business were driven by demand for crypto, creating the impression that the company’s gaming business was not significantly affected by crypto mining,” the SEC stated in its filing.
The SEC’s investigation was conducted by Brent Wilner of the Crypto Assets and Cyber Unit and supervised by Diana Tani and Kristina Littman of the Crypto Assets and Cyber Unit.
“NVIDIA’s disclosure failures deprived investors of critical information to evaluate the company’s business in a key market,” said Littman, Chief of the SEC Enforcement Division’s Crypto Assets and Cyber Unit.
Source - SEC
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