Nvidia board probes CEO Jensen Huang's ties to alleged Chinese spy, shares down 9.5%

Admission and board probe

On Sunday, 8 November, Jensen Huang, the 63-year-old chief executive of Nvidia, acknowledged an extramarital relationship with Alice Huang, a Chinese businesswoman whom US intelligence reportedly regards as a spy for Beijing. Nvidia's board responded by appointing Jun Kim, a former acting US attorney for the Southern District of New York, and the law firm Wachtell, Lipton, Rosen & Katz to run an independent investigation. Kim had joined the firm last month after serving as the top federal prosecutor in Manhattan. The board said it had no reason to believe company secrets or US national security had been compromised, and Huang has pledged to cooperate with the inquiry. The probe will focus on his relationship with Alice Huang and her ties to Megaspeed International, a company that is a customer of Nvidia.

Intelligence allegations

The New York Times and the Financial Times reported that US intelligence agencies had monitored Alice Huang, a senior Asian technology executive, and concluded that she passed information to Beijing and worked with Chinese intelligence services. The FBI is separately examining whether Jensen Huang himself was the target of a foreign intelligence operation. Documents cited by the New York Post describe Kang Wei, a 51-year-old investor who presented himself as her husband, as the founder of the private investment firm Hexi Capital, set up in 2010. Sources cited by the New York Times and CNN say Secretary of State Marco Rubio briefed Donald Trump on the intelligence aboard Air Force One during the May flight to China, when the matter had already been discussed at an Alaska stopover before Jensen Huang boarded.

At a press conference on Monday, 9 November, Trump said he had been informed of the questions and that the FBI is looking into the matter. He said he did not know about the concerns when he invited Jensen Huang to join him on the May trip to Beijing. A White House spokesperson responded on Tuesday, 10 November, by pointing to Trump's remarks and dismissing the sources' accounts.

Shares and chip shipments

Nvidia shares fell more than 4% on Monday, 9 November, and about 6% on Tuesday, 10 November. Reuters puts the market value lost at about $430 billion over two sessions, while a second estimate put the figure above $470 billion for the same period. Another report put the Tuesday fall at 6.5%. On Tuesday, The Information reported that Alice Huang used her contacts with Nvidia to secure about 240,000 H100, H200 and A100 chips worth at least $7.5 billion. Some of those chips are subject to US export restrictions on China, and part of them reportedly ended up with Chinese technology companies.

Separately, Reuters reported that Northwestern Polytechnical University, a Chinese institution with close ties to the People's Liberation Army, bought two H200 chips in October for 874,700 yuan ($123,000). A procurement record dated 21 October shows the chips were bought through Shaanxi Bosuan Network Technology rather than directly from Nvidia.

Political pressure

Lawmakers from both major US parties have called for congressional investigations into Jensen Huang's conduct. Democrats and Republicans have also pressed for tighter controls on China's access to advanced AI chips, including chip tracking requirements and greater congressional oversight of exports. Three Republican committee chairs have asked Jensen Huang for a briefing on 18 November about his reported contacts with a suspected Chinese intelligence agent.