In re NVIDIA CORPORATION

UNITED STATES OF AMERICA 
Before the 
SECURITIES AND EXCHANGE COMMISSION 
 
SECURITIES ACT OF 1933 
Release No. 11060 / May 6, 2022 
 
SECURITIES EXCHANGE ACT OF 1934 
Release No. 94859 / May 6, 2022 
 
ADMINISTRATIVE PROCEEDING 
File No. 3-20844 
 
In the Matter of 
 
NVIDIA CORPORATION, 
 
Respondent. 
 
 
ORDER INSTITUTING CEASE-AND-
DESIST PROCEEDINGS PURSUANT TO 
SECTION 8A OF THE SECURITIES ACT 
OF 1933 AND SECTION 21C OF THE 
SECURITIES EXCHANGE ACT OF 1934, 
MAKING FINDINGS, AND IMPOSING A 
CEASE-AND-DESIST ORDER 
  
I. 
 
 The Securities and Exchange Commission (“Commission”) deems it appropriate that cease-
and-desist proceedings be, and hereby are, instituted pursuant to Section 8A of the Securities Act 
of 1933 (“Securities Act”) and Section 21C of the Securities Exchange Act of 1934 (“Exchange 
Act”), against NVIDIA Corporation (“NVIDIA” or “Respondent” or the “company”). 
 
II. 
 
 In anticipation of the institution of these proceedings, Respondent has submitted an Offer 
of Settlement (the “Offer”) which the Commission has determined to accept.  Solely for the 
purpose of these proceedings and any other proceedings brought by or on behalf of the 
Commission, or to which the Commission is a party, and without admitting or denying the findings 
herein, except as to the Commission’s jurisdiction over it and the subject matter of these 
proceedings, which are admitted, Respondent consents to the entry of this Order Instituting Cease-
and-Desist Proceedings Pursuant to Section 8A of the Securities Act of 1933 and Section 21C of 
the Securities Exchange Act of 1934, Making Findings, and Imposing a Cease-and-Desist Order 
(“Order”), as set forth below.   

 2 
III. 
 
 On the basis of this Order and Respondent’s Offer, the Commission finds that: 
 
Summary 
 
1. This matter concerns NVIDIA’s disclosures during two consecutive quarters in its 
fiscal year 2018 related to the impact of cryptomining on the growth of revenue from the sale of 
graphics processing units (“GPUs”) NVIDIA designed and marketed for gaming.  During the 
second and third fiscal quarters of 2018 (the “relevant period”), as certain crypto asset prices rose, 
users of NVIDIA’s GPUs were increasingly performing cryptomining.  NVIDIA had information 
indicating that cryptomining was a significant factor in the year-over-year growth in revenue from 
the sale of GPUs that NVIDIA designed and marketed for gaming.  The company, however, did 
not disclose this in the company’s Forms 10-Q for these quarters as required by former Regulation 
S-K, Item 303(b)(2) (currently Item 303(c)(2)), part of the company’s Management’s Discussion 
and Analysis of Financial Condition and Results of Operations (“MD&A”) disclosure 
requirements.  NVIDIA also failed to maintain adequate disclosure controls and procedures as 
required by Exchange Act Rule 13a-15(a) related to its MD&A requirements. 
Respondent 
 
2. NVIDIA Corporation, a Delaware corporation headquartered in Santa Clara, 
California, designs and markets GPUs for various computing applications, including video games.  
NVIDIA’s common stock is registered pursuant to Section 12(b) of the Exchange Act.  NVIDIA’s 
common stock trades on the NASDAQ.   
Facts 
Impact of Cryptomining on NVIDIA’s Gaming Business 
3. During fiscal year 2018 (ending January 28, 2018), NVIDIA reported its results in 
two reportable segments: GPUs and Tegra processors.  GPUs designed for desktops, notebooks, or 
cryptomining were all reported in the GPU business segment.  The company also reported its 
revenue by its specialized market platforms, including gaming and original equipment 
manufacturer (“OEM”), where products are categorized by how they are designed and marketed.  
The gaming specialized market (“Gaming”) was historically and during this time frame the 
company’s largest specialized market.  During fiscal year 2018, over half of the company’s 
total $9.714 billion in reported revenue was attributed to Gaming, inclusive of GPUs for desktops 
and notebooks and system-on-a-chip modules for consoles.   
4. Beginning in fiscal year 2018, GPUs became popular for cryptomining Ether 
(“ETH”) and other crypto assets.  Prior to fiscal year 2018, cryptomining did not meaningfully 
impact demand for the company’s GPUs, and crypto assets were not referenced in NVIDIA’s 
Form 10-K for fiscal year 2017. 

 3 
5. The rise in demand for GPUs for performing cryptomining corresponded with the 
rise in certain crypto asset prices.  ETH prices rose from under $10 on January 1, 2017, to 
nearly $800 on January 1, 2018.  During the relevant period, some of NVIDIA’s sales personnel 
expressed their belief that much of the increased demand for the company’s Gaming products, 
primarily in China, was being driven by cryptomining.  
6. NVIDIA’s senior management internally expressed a desire to capture the 
cryptomining demand, and at the same time shelter its Gaming business from cryptominers and 
protect supply of GPUs for gamers.  As a result, NVIDIA launched a product line of cryptomining 
processors, known as “CMP,” which the company marketed to large cryptomining operations.  
NVIDIA’s Forms 10-Q for the second and third fiscal quarters 2018 reported the CMP sales in the 
GPU reportable segment within PC OEM revenue.  Based on known CMP sales, the company 
identified cryptomining as a significant element of the OEM GPU sales within the GPU reportable 
segment revenue in the company’s quarterly reports.   
7. During the relevant period, NVIDIA also received information indicating that 
cryptomining was a significant factor in year-over-year growth in NVIDIA’s Gaming GPUs 
revenue.  Some of the company’s sales personnel, in particular in China, reported what they 
believed to be significant increases in demand for Gaming GPUs as a result of cryptomining.  In 
addition, while the company could not track when and which specific Gaming GPUs were 
purchased for the purpose of cryptomining, company personnel estimated using various 
assumptions that the impact of cryptomining was at levels that would indicate cryptomining was a 
significant factor in the year-over-year growth in Gaming revenue during the relevant period.    
8. During the relevant period, NVIDIA experienced material changes to its total and 
Gaming revenue as compared to the corresponding period of the prior fiscal year.  The company’s 
Gaming revenue increased by 52%, year over year for the second fiscal quarter 2018, and by 25%, 
year over year for the third fiscal quarter 2018.   
9. During the relevant period, NVIDIA had information indicating that cryptomining 
was a significant factor in the material year-over-year growth in NVIDIA’s Gaming and total 
revenue.   
NVIDIA’s Misleading Disclosures Regarding Cryptomining 
10. NVIDIA filed its quarterly reports for the second and third fiscal quarters of 2018 
on Forms 10-Q on August 23, 2017 and November 21, 2017, respectively.  Analysts and investors 
were interested in understanding whether the company’s Gaming revenue was impacted by 
cryptomining.  However, NVIDIA failed to disclose in these filings that cryptomining was a 
significant factor in year-over-year growth in the company’s Gaming revenue.   
11. Section 13(a) of the Exchange Act and Rule 13a-13 therunder require companies 
such as NVIDIA to file Forms 10-Q containing Item 303 of Regulation S-K disclosures.  As 
operative during the relevant period, Item 303(b)(2) required issuers to disclose in quarterly reports 
“any material changes in the registrant’s results of operations . . . with respect to that fiscal quarter 
and the corresponding fiscal quarter in the preceding fiscal year.”  Former 17 C.F.R. 

 4 
§ 229.303(b)(2) (subsequently amended, 17 C.F.R. § 229.303(c)(2)).  Regulation S-K also required 
that the discussion of material changes in results of operations during the quarter “shall identify 
any significant elements of the registrant’s income or loss from continuing operations which do not 
arise from or are not necessarily representative of the registrant’s ongoing business.”  Former 17 
C.F.R. § 229.303(b), Instruction 4 (subsequently amended, 17 C.F.R. § 229.303(c), Instruction 2).  
As the Commission stated in a 2003 MD&A interpretive release, “if events and transactions 
reported in the financial statements reflect material unusual or non-recurring items, aberrations, or 
other significant fluctuations, companies should consider the extent of variability in earnings and 
cash flow, and provide disclosure where necessary for investors to ascertain the likelihood that past 
performance is indicative of future performance.”  Commission Guidance Regarding 
Management’s Discussion and Analysis of Financial Condition and Results of Operation (Dec. 19, 
2003), available at www.sec.gov/rules/interp/33-8350.htm.   
12. In the MD&A section of its Forms 10-Q for the second and third fiscal 
quarters 2018, NVIDIA failed to disclose that cryptomining was a significant factor in the material 
year-over-year growth in NVIDIA’s Gaming revenue.  As a result, the Forms 10-Q omitted 
significant information relating to NVIDIA’s GPU segment revenue and its component GPUs for 
gaming, and any related risks, during these quarters. 
13. At the same time, the company’s Forms 10-Q for the relevant period did disclose 
that cryptomining was a significant element of OEM GPU sales during the relevant period based 
on known sales of CMPs.  The company’s omissions in the Forms 10-Q concerning the impact of 
cryptomining on GPUs for Gaming coupled with these disclosures about the impact on NVIDIA’s 
OEM revenue gave the misimpression in the Forms 10-Q during the relevant period that the year-
over-year growth in the company’s Gaming revenue was not meaningfully impacted by 
cryptomining.   
14. Throughout the relevant period, NVIDIA’s analysts and investors were interested in 
understanding the extent to which the company’s Gaming revenue was impacted by cryptomining, 
and routinely asked senior management about the extent to which increases in Gaming revenue 
during this time frame were driven by cryptomining.  In light of the volatility of certain crypto 
asset prices during this time frame, investors and analysts probed the significance of cryptomining 
to NVIDIA’s Gaming business to determine how sustainable the contributions to the company’s 
largest specialized market would be going forward. 
15. The company’s periodic reports did not identify cryptomining as a significant factor 
in year-over-year growth in Gaming revenue until the end of fiscal year 2018, disclosing this in the 
company’s Form 10-K for fiscal year 2018 (filed on February 28, 2018).  In that Form 10-K, the 
company also identified fluctuations in crypto asset prices as a risk to the company’s results of 
operations. 
16. During the relevant period, NVIDIA offered and sold securities, including issuing 
shares as compensation to certain employees under the company’s employee incentive plans, and 
selling shares under its employee stock purchase plan.   

 5 
NVIDIA’s Disclosure Control and Procedures Failures 
17. Exchange Act Rule 13a-15(a) requires issuers such as NVIDIA to “maintain 
disclosure controls and procedures . . . as defined in paragraph (e) of this section.”  Paragraph (e) 
defines disclosure controls and procedures to include, among other things, “procedures . . . 
designed to ensure that information required to be disclosed by the issuer in the reports that it files 
or submits under the [Exchange] Act . . . is recorded, processed, summarized, and reported[] within 
the time periods specified in the Commission’s rules and forms.” 
18. Even though NVIDIA had information indicating that cryptomining was a 
significant factor in the year-over-year growth in revenue for the company’s GPUs for Gaming in 
its GPU business segment during the relevant period, NVIDIA failed to maintain disclosure 
controls or procedures designed to ensure that information required to be disclosed in NVIDIA’s 
results of operations was reported as required by the MD&A provisions of Regulation S-K, 
Item 303.       
Violations 
19. As a result of the conduct described above, NVIDIA violated Sections 17(a)(2) 
and (3) of the Securities Act, which prohibit any person from directly or indirectly obtaining 
money or property by means of any untrue statement of a material fact or any omission to state a 
material fact necessary in order to make the statements made, in light of the circumstances under 
which they were made, not misleading, or engaging in any transaction, practice, or course of 
business which operates or would operate as a fraud or deceit upon the purchaser, in the offer or 
sales of securities.  A violation of these provisions does not require scienter and may rest on a 
finding of negligence.  See Aaron v. SEC, 446 U.S. 680, 685, 701-02 (1980). 
20. In addition, NVIDIA violated Section 13(a) of the Exchange Act and Rule 13a-13 
thereunder, which require reporting companies to file with the Commission complete and accurate 
quarterly reports.  NVIDIA also violated Rule 12b-20 of the Exchange Act, which requires an 
issuer to include in a statement or report filed with the Commission any information necessary to 
make the required statements in the filing not materially misleading. 
21. In addition, NVIDIA violated Exchange Act Rule 13a-15(a), which requires every 
issuer of a security registered pursuant to Section 12 of the Exchange Act to maintain disclosure 
controls and procedures designed to ensure that information required to be disclosed by an issuer in 
reports it files or submits under the Exchange Act is recorded, processed, summarized, and 
reported within the time periods specified in the Commission’s rules and forms. 
IV. 
 
 In view of the foregoing, the Commission deems it appropriate and in the public interest to 
impose the sanctions agreed to in Respondent NVIDIA’s Offer. 
 
 Accordingly, it is hereby ORDERED that: 
 

 6 
 A. Pursuant to Section 8A of the Securities Act and Section 21C of the Exchange Act, 
Respondent cease and desist from committing or causing any violations and any future violations of 
Sections 17(a)(2) and (3) of the Securities Act and Section 13(a) of the Exchange Act and 
Rules 12b-20, 13a-13, and 13a-15 thereunder. 
 
 B. Respondent shall,  within  14 days  of  the  entry  of  this  Order,  pay  a  civil  money 
penalty in the amount of $5,500,000 to the Securities and Exchange Commission for transfer to the 
general  fund of the United  States  Treasury,  subject to Exchange  Act Section  21F(g)(3). If timely 
payment is not made, additional interest shall accrue pursuant to 31 U.S.C. §3717.   
 
Payment must be made in one of the following ways:   
 
(1) Respondent may transmit payment electronically to the Commission, which 
will provide detailed ACH transfer/Fedwire instructions upon request;  
 
(2) Respondent may make direct payment from a bank account via Pay.gov 
through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or  
 
(3) Respondent may pay by certified check, bank cashier’s check, or United 
States postal money order, made payable to the Securities and Exchange 
Commission and hand-delivered or mailed to:  
 
Enterprise Services Center 
Accounts Receivable Branch 
HQ Bldg., Room 181, AMZ-341 
6500 South MacArthur Boulevard 
Oklahoma City, OK 73169 
 
Payments by check or money order must be accompanied by a cover letter identifying 
NVIDIA as a Respondent in these proceedings, and the file number of these proceedings; a copy of 
the cover letter and check or money order must be sent to Kristina Littman, Division of 
Enforcement, Securities and Exchange Commission, 100 F Street, N.E., Washington, District of 
Columbia 20549.   
 
 C. Amounts ordered to be paid as civil money penalties pursuant to this Order shall be 
treated as penalties paid to the government for all purposes, including all tax purposes.  To 
preserve the deterrent effect of the civil penalty, Respondent agrees that in any Related Investor 
Action, it shall not argue that it is entitled to, nor shall it benefit by, offset or reduction of any 
award of compensatory damages by the amount of any part of Respondent’s payment of a civil 
penalty in this action (“Penalty Offset”).  If the court in any Related Investor Action grants such a 
Penalty Offset, Respondent agrees that it shall, within 30 days after entry of a final order granting 
the Penalty Offset, notify the Commission’s counsel in this action and pay the amount of the 
Penalty Offset to the Securities and Exchange Commission.  Such a payment shall not be deemed 
an additional civil penalty and shall not be deemed to change the amount of the civil penalty 
imposed in this proceeding.  For purposes of this paragraph, a “Related Investor Action” means a 

 7 
private damages action brought against Respondent by or on behalf of one or more investors based 
on substantially the same facts as alleged in the Order instituted by the Commission in this 
proceeding. 
 
 
 By the Commission. 
 
 
 
Vanessa A. Countryman 
Secretary 
 

UNITED STATES OF AMERICA 

Before the 

SECURITIES AND EXCHANGE COMMISSION 

 

SECURITIES ACT OF 1933 

Release No. 11060 / May 6, 2022 

 

SECURITIES EXCHANGE ACT OF 1934 

Release No. 94859 / May 6, 2022 

 

ADMINISTRATIVE PROCEEDING 

File No. 3-20844 

 

In the Matter of 

 

NVIDIA CORPORATION, 

 

Respondent. 

 

 

ORDER INSTITUTING CEASE-AND-

DESIST PROCEEDINGS PURSUANT TO 

SECTION 8A OF THE SECURITIES ACT 

OF 1933 AND SECTION 21C OF THE 

SECURITIES EXCHANGE ACT OF 1934, 

MAKING FINDINGS, AND IMPOSING A 

CEASE-AND-DESIST ORDER 

  

I. 
 

 The Securities and Exchange Commission (“Commission”) deems it appropriate that cease-

and-desist proceedings be, and hereby are, instituted pursuant to Section 8A of the Securities Act 

of 1933 (“Securities Act”) and Section 21C of the Securities Exchange Act of 1934 (“Exchange 

Act”), against NVIDIA Corporation (“NVIDIA” or “Respondent” or the “company”). 

 

II. 

 

 In anticipation of the institution of these proceedings, Respondent has submitted an Offer 

of Settlement (the “Offer”) which the Commission has determined to accept.  Solely for the 

purpose of these proceedings and any other proceedings brought by or on behalf of the 

Commission, or to which the Commission is a party, and without admitting or denying the findings 

herein, except as to the Commission’s jurisdiction over it and the subject matter of these 

proceedings, which are admitted, Respondent consents to the entry of this Order Instituting Cease-

and-Desist Proceedings Pursuant to Section 8A of the Securities Act of 1933 and Section 21C of 

the Securities Exchange Act of 1934, Making Findings, and Imposing a Cease-and-Desist Order 

(“Order”), as set forth below.   



 2 

III. 
 

 On the basis of this Order and Respondent’s Offer, the Commission finds that: 

 

Summary 

 

1. This matter concerns NVIDIA’s disclosures during two consecutive quarters in its 

fiscal year 2018 related to the impact of cryptomining on the growth of revenue from the sale of 

graphics processing units (“GPUs”) NVIDIA designed and marketed for gaming.  During the 

second and third fiscal quarters of 2018 (the “relevant period”), as certain crypto asset prices rose, 

users of NVIDIA’s GPUs were increasingly performing cryptomining.  NVIDIA had information 

indicating that cryptomining was a significant factor in the year-over-year growth in revenue from 

the sale of GPUs that NVIDIA designed and marketed for gaming.  The company, however, did 

not disclose this in the company’s Forms 10-Q for these quarters as required by former Regulation 

S-K, Item 303(b)(2) (currently Item 303(c)(2)), part of the company’s Management’s Discussion 

and Analysis of Financial Condition and Results of Operations (“MD&A”) disclosure 

requirements.  NVIDIA also failed to maintain adequate disclosure controls and procedures as 

required by Exchange Act Rule 13a-15(a) related to its MD&A requirements. 

Respondent 

 

2. NVIDIA Corporation, a Delaware corporation headquartered in Santa Clara, 

California, designs and markets GPUs for various computing applications, including video games.  

NVIDIA’s common stock is registered pursuant to Section 12(b) of the Exchange Act.  NVIDIA’s 

common stock trades on the NASDAQ.   

Facts 

Impact of Cryptomining on NVIDIA’s Gaming Business 

3. During fiscal year 2018 (ending January 28, 2018), NVIDIA reported its results in 

two reportable segments: GPUs and Tegra processors.  GPUs designed for desktops, notebooks, or 

cryptomining were all reported in the GPU business segment.  The company also reported its 

revenue by its specialized market platforms, including gaming and original equipment 

manufacturer (“OEM”), where products are categorized by how they are designed and marketed.  

The gaming specialized market (“Gaming”) was historically and during this time frame the 

company’s largest specialized market.  During fiscal year 2018, over half of the company’s 

total $9.714 billion in reported revenue was attributed to Gaming, inclusive of GPUs for desktops 

and notebooks and system-on-a-chip modules for consoles.   

4. Beginning in fiscal year 2018, GPUs became popular for cryptomining Ether 

(“ETH”) and other crypto assets.  Prior to fiscal year 2018, cryptomining did not meaningfully 

impact demand for the company’s GPUs, and crypto assets were not referenced in NVIDIA’s 

Form 10-K for fiscal year 2017. 



 3 

5. The rise in demand for GPUs for performing cryptomining corresponded with the 

rise in certain crypto asset prices.  ETH prices rose from under $10 on January 1, 2017, to 

nearly $800 on January 1, 2018.  During the relevant period, some of NVIDIA’s sales personnel 

expressed their belief that much of the increased demand for the company’s Gaming products, 

primarily in China, was being driven by cryptomining.  

6. NVIDIA’s senior management internally expressed a desire to capture the 

cryptomining demand, and at the same time shelter its Gaming business from cryptominers and 

protect supply of GPUs for gamers.  As a result, NVIDIA launched a product line of cryptomining 

processors, known as “CMP,” which the company marketed to large cryptomining operations.  

NVIDIA’s Forms 10-Q for the second and third fiscal quarters 2018 reported the CMP sales in the 

GPU reportable segment within PC OEM revenue.  Based on known CMP sales, the company 

identified cryptomining as a significant element of the OEM GPU sales within the GPU reportable 

segment revenue in the company’s quarterly reports.   

7. During the relevant period, NVIDIA also received information indicating that 

cryptomining was a significant factor in year-over-year growth in NVIDIA’s Gaming GPUs 

revenue.  Some of the company’s sales personnel, in particular in China, reported what they 

believed to be significant increases in demand for Gaming GPUs as a result of cryptomining.  In 

addition, while the company could not track when and which specific Gaming GPUs were 

purchased for the purpose of cryptomining, company personnel estimated using various 

assumptions that the impact of cryptomining was at levels that would indicate cryptomining was a 

significant factor in the year-over-year growth in Gaming revenue during the relevant period.    

8. During the relevant period, NVIDIA experienced material changes to its total and 

Gaming revenue as compared to the corresponding period of the prior fiscal year.  The company’s 

Gaming revenue increased by 52%, year over year for the second fiscal quarter 2018, and by 25%, 

year over year for the third fiscal quarter 2018.   

9. During the relevant period, NVIDIA had information indicating that cryptomining 

was a significant factor in the material year-over-year growth in NVIDIA’s Gaming and total 

revenue.   

NVIDIA’s Misleading Disclosures Regarding Cryptomining 

10. NVIDIA filed its quarterly reports for the second and third fiscal quarters of 2018 

on Forms 10-Q on August 23, 2017 and November 21, 2017, respectively.  Analysts and investors 

were interested in understanding whether the company’s Gaming revenue was impacted by 

cryptomining.  However, NVIDIA failed to disclose in these filings that cryptomining was a 

significant factor in year-over-year growth in the company’s Gaming revenue.   

11. Section 13(a) of the Exchange Act and Rule 13a-13 therunder require companies 

such as NVIDIA to file Forms 10-Q containing Item 303 of Regulation S-K disclosures.  As 

operative during the relevant period, Item 303(b)(2) required issuers to disclose in quarterly reports 

“any material changes in the registrant’s results of operations . . . with respect to that fiscal quarter 

and the corresponding fiscal quarter in the preceding fiscal year.”  Former 17 C.F.R. 



 4 

§ 229.303(b)(2) (subsequently amended, 17 C.F.R. § 229.303(c)(2)).  Regulation S-K also required 

that the discussion of material changes in results of operations during the quarter “shall identify 

any significant elements of the registrant’s income or loss from continuing operations which do not 

arise from or are not necessarily representative of the registrant’s ongoing business.”  Former 17 

C.F.R. § 229.303(b), Instruction 4 (subsequently amended, 17 C.F.R. § 229.303(c), Instruction 2).  

As the Commission stated in a 2003 MD&A interpretive release, “if events and transactions 

reported in the financial statements reflect material unusual or non-recurring items, aberrations, or 

other significant fluctuations, companies should consider the extent of variability in earnings and 

cash flow, and provide disclosure where necessary for investors to ascertain the likelihood that past 

performance is indicative of future performance.”  Commission Guidance Regarding 

Management’s Discussion and Analysis of Financial Condition and Results of Operation (Dec. 19, 

2003), available at www.sec.gov/rules/interp/33-8350.htm.   

12. In the MD&A section of its Forms 10-Q for the second and third fiscal 

quarters 2018, NVIDIA failed to disclose that cryptomining was a significant factor in the material 

year-over-year growth in NVIDIA’s Gaming revenue.  As a result, the Forms 10-Q omitted 

significant information relating to NVIDIA’s GPU segment revenue and its component GPUs for 

gaming, and any related risks, during these quarters. 

13. At the same time, the company’s Forms 10-Q for the relevant period did disclose 

that cryptomining was a significant element of OEM GPU sales during the relevant period based 

on known sales of CMPs.  The company’s omissions in the Forms 10-Q concerning the impact of 

cryptomining on GPUs for Gaming coupled with these disclosures about the impact on NVIDIA’s 

OEM revenue gave the misimpression in the Forms 10-Q during the relevant period that the year-

over-year growth in the company’s Gaming revenue was not meaningfully impacted by 

cryptomining.   

14. Throughout the relevant period, NVIDIA’s analysts and investors were interested in 

understanding the extent to which the company’s Gaming revenue was impacted by cryptomining, 

and routinely asked senior management about the extent to which increases in Gaming revenue 

during this time frame were driven by cryptomining.  In light of the volatility of certain crypto 

asset prices during this time frame, investors and analysts probed the significance of cryptomining 

to NVIDIA’s Gaming business to determine how sustainable the contributions to the company’s 

largest specialized market would be going forward. 

15. The company’s periodic reports did not identify cryptomining as a significant factor 

in year-over-year growth in Gaming revenue until the end of fiscal year 2018, disclosing this in the 

company’s Form 10-K for fiscal year 2018 (filed on February 28, 2018).  In that Form 10-K, the 

company also identified fluctuations in crypto asset prices as a risk to the company’s results of 

operations. 

16. During the relevant period, NVIDIA offered and sold securities, including issuing 

shares as compensation to certain employees under the company’s employee incentive plans, and 

selling shares under its employee stock purchase plan.   

http://www.sec.gov/rules/interp/33-8350.htm


 5 

NVIDIA’s Disclosure Control and Procedures Failures 

17. Exchange Act Rule 13a-15(a) requires issuers such as NVIDIA to “maintain 

disclosure controls and procedures . . . as defined in paragraph (e) of this section.”  Paragraph (e) 

defines disclosure controls and procedures to include, among other things, “procedures . . . 

designed to ensure that information required to be disclosed by the issuer in the reports that it files 

or submits under the [Exchange] Act . . . is recorded, processed, summarized, and reported[] within 

the time periods specified in the Commission’s rules and forms.” 

18. Even though NVIDIA had information indicating that cryptomining was a 

significant factor in the year-over-year growth in revenue for the company’s GPUs for Gaming in 

its GPU business segment during the relevant period, NVIDIA failed to maintain disclosure 

controls or procedures designed to ensure that information required to be disclosed in NVIDIA’s 

results of operations was reported as required by the MD&A provisions of Regulation S-K, 

Item 303.       

Violations 

19. As a result of the conduct described above, NVIDIA violated Sections 17(a)(2) 

and (3) of the Securities Act, which prohibit any person from directly or indirectly obtaining 

money or property by means of any untrue statement of a material fact or any omission to state a 

material fact necessary in order to make the statements made, in light of the circumstances under 

which they were made, not misleading, or engaging in any transaction, practice, or course of 

business which operates or would operate as a fraud or deceit upon the purchaser, in the offer or 

sales of securities.  A violation of these provisions does not require scienter and may rest on a 

finding of negligence.  See Aaron v. SEC, 446 U.S. 680, 685, 701-02 (1980). 

20. In addition, NVIDIA violated Section 13(a) of the Exchange Act and Rule 13a-13 

thereunder, which require reporting companies to file with the Commission complete and accurate 

quarterly reports.  NVIDIA also violated Rule 12b-20 of the Exchange Act, which requires an 

issuer to include in a statement or report filed with the Commission any information necessary to 

make the required statements in the filing not materially misleading. 

21. In addition, NVIDIA violated Exchange Act Rule 13a-15(a), which requires every 

issuer of a security registered pursuant to Section 12 of the Exchange Act to maintain disclosure 

controls and procedures designed to ensure that information required to be disclosed by an issuer in 

reports it files or submits under the Exchange Act is recorded, processed, summarized, and 

reported within the time periods specified in the Commission’s rules and forms. 

IV. 

 

 In view of the foregoing, the Commission deems it appropriate and in the public interest to 

impose the sanctions agreed to in Respondent NVIDIA’s Offer. 

 

 Accordingly, it is hereby ORDERED that: 

 



 6 

 A. Pursuant to Section 8A of the Securities Act and Section 21C of the Exchange Act, 

Respondent cease and desist from committing or causing any violations and any future violations of 

Sections 17(a)(2) and (3) of the Securities Act and Section 13(a) of the Exchange Act and 

Rules 12b-20, 13a-13, and 13a-15 thereunder. 

 

 B. Respondent shall, within 14 days of the entry of this Order, pay a civil money 

penalty in the amount of $5,500,000 to the Securities and Exchange Commission for transfer to the 

general fund of the United States Treasury, subject to Exchange Act Section 21F(g)(3). If timely 

payment is not made, additional interest shall accrue pursuant to 31 U.S.C. §3717.   

 

Payment must be made in one of the following ways:   

 

(1) Respondent may transmit payment electronically to the Commission, which 

will provide detailed ACH transfer/Fedwire instructions upon request;  

 

(2) Respondent may make direct payment from a bank account via Pay.gov 

through the SEC website at http://www.sec.gov/about/offices/ofm.htm; or  

 

(3) Respondent may pay by certified check, bank cashier’s check, or United 

States postal money order, made payable to the Securities and Exchange 

Commission and hand-delivered or mailed to:  

 

Enterprise Services Center 

Accounts Receivable Branch 

HQ Bldg., Room 181, AMZ-341 

6500 South MacArthur Boulevard 

Oklahoma City, OK 73169 

 

Payments by check or money order must be accompanied by a cover letter identifying 

NVIDIA as a Respondent in these proceedings, and the file number of these proceedings; a copy of 

the cover letter and check or money order must be sent to Kristina Littman, Division of 

Enforcement, Securities and Exchange Commission, 100 F Street, N.E., Washington, District of 

Columbia 20549.   

 

 C. Amounts ordered to be paid as civil money penalties pursuant to this Order shall be 

treated as penalties paid to the government for all purposes, including all tax purposes.  To 

preserve the deterrent effect of the civil penalty, Respondent agrees that in any Related Investor 

Action, it shall not argue that it is entitled to, nor shall it benefit by, offset or reduction of any 

award of compensatory damages by the amount of any part of Respondent’s payment of a civil 

penalty in this action (“Penalty Offset”).  If the court in any Related Investor Action grants such a 

Penalty Offset, Respondent agrees that it shall, within 30 days after entry of a final order granting 

the Penalty Offset, notify the Commission’s counsel in this action and pay the amount of the 

Penalty Offset to the Securities and Exchange Commission.  Such a payment shall not be deemed 

an additional civil penalty and shall not be deemed to change the amount of the civil penalty 

imposed in this proceeding.  For purposes of this paragraph, a “Related Investor Action” means a 

http://www.sec.gov/about/offices/ofm.htm


 7 

private damages action brought against Respondent by or on behalf of one or more investors based 

on substantially the same facts as alleged in the Order instituted by the Commission in this 

proceeding. 

 

 

 By the Commission. 

 

 

 

Vanessa A. Countryman 

Secretary