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NVIDIA Fraud Claims Debunked by Analyst
25 Nov
Summary
- Analyst Ming-Chi Kuo addressed claims of fraud at NVIDIA.
- DSO and inventory figures were deemed reasonable and industry-aligned.
- Inventory surge linked to preparation for high demand of new GPUs.
Prominent tech analyst Ming-Chi Kuo has addressed recent criticisms and allegations of fraud concerning NVIDIA's financial reporting. Kuo specifically debunked notions that the company's Days Sales Outstanding (DSO) and inventory levels are abnormal, asserting they align with standard industry practices and market dynamics.
Kuo clarified that rising DSO is a natural consequence of concentrating receivables with a few large customers, reflecting their significant bargaining power. He also corrected comparisons made against inappropriate peer groups, noting that when measured against suppliers serving the same cloud providers, NVIDIA's DSO is within expected ranges. The analyst further explained that a recent 32% quarter-over-quarter inventory jump in Q3 FY26 was factually misrepresented and is tied to increased upstream capacity and preparation for the Blackwell B300 GPU.
These comments come as NVIDIA faces scrutiny over its financial practices, with some independent researchers highlighting a surge in accounts receivable, longer payment cycles, and inventory increases as red flags. Kuo's analysis suggests these concerns stem from factual errors and misinterpretations of standard financial operations and industry trends, emphasizing that NVIDIA's actions demonstrate preparation for robust demand.
