Nvidia’s stock experienced a significant drop on Monday following an internal inquiry regarding whether CEO Jensen Huang had been the target of a foreign intelligence operation, raising questions about his future with the AI chipmaker.
The investigation was prompted by a report indicating that Huang had a close association with a Chinese businesswoman suspected of relaying information to the Chinese government. During a communication with Nvidia staff, Huang admitted to being unfaithful to his spouse but refrained from sharing specifics about the relationship.
This inquiry, which was made public on Sunday, has cast a shadow over Huang’s future at Nvidia, known as the most valuable chip manufacturer globally, particularly since he is a key figure in driving the current AI boom.
Huang, often seen in his signature leather jacket, enjoys a rock star-like reputation internationally, especially in Asia, where he frequently interacts with fans, takes selfies, and signs autographs for his enthusiastic supporters.
With approximately a 3.6 percent stake, he ranks as Nvidia’s fifth-largest shareholder, as per LSEG data, and maintains a strong influence over the company thanks to its relatively flat organizational structure, where many executives report directly to him.
However, unlike companies such as Meta Platforms or SpaceX, Nvidia does not employ dual-class shares that would grant its co-founder majority voting power.
The repercussions of the inquiry reached South Korea, where Madison Huang, the CEO’s daughter and an executive at Nvidia, canceled a scheduled trip to Seoul for an Nvidia conference set to commence on Monday, as per the companies she was supposed to meet.
Nvidia’s shares fell by about six percent, reaching their lowest point during the day since March 31.
“The market is likely indicating that this situation does not benefit the stock at all, especially at a time filled with speculation regarding the expansion of data centers,” remarked Chris Weston, head of research at Pepperstone brokerage in Melbourne, Australia.
Despite this, Weston expressed skepticism that Huang, whom he referred to as the “godfather of AI,” would be replaced.
“If we genuinely believed he would resign… the stock would be down significantly — it would be a complete disaster, to put it frankly,” he noted.
Nvidia stated that its board has faith in Huang. Some analysts believe there is no natural successor within the organization should he decide to resign.
Last month, The New York Times reported that Huang had a relationship with Alice Huang, an unrelated former executive from Singapore-based Megaspeed, who was investigated by U.S. authorities and found to be a Chinese intelligence asset.
Guo Jiakun, spokesperson for the Chinese Foreign Ministry, stated to reporters in Beijing, “The alleged narrative of a Chinese spy is nothing but baseless accusation, slander, and defamation.”
A screengrab from CTI video footage obtained Monday shows a woman identified by Reuters as Alice Huang, after comparison with a photograph obtained separately, attending a dinner with Nvidia CEO Jensen Huang at a restaurant in Taipei, Taiwan, on May 22, 2025. (CTI/Reuters)
Megaspeed did not immediately provide a comment on Monday, which is a public holiday in Singapore.
When approached by The New York Times last month regarding her relationship with Huang, Alice Huang did not reply, and Reuters could not ascertain her whereabouts to seek comments on Monday.
Asia partners unaffected
Shares of Nvidia’s main Asian chip suppliers saw a recovery on Monday after last week’s decline of AI-related stocks, with TSMC closing 4.7 percent higher, while Samsung Electronics and SK Hynix rose by 0.6 percent and 0.4 percent, respectively.
Notable figures commented on Huang’s admission. Billionaire investor Bill Ackman, founder of Pershing Square Capital Management, remarked on X that the Nvidia CEO was an “incredible human,” but added that if “this is more than just an affair, it poses a real problem.”
“I hope this is merely an affair, not a threat to our national security,” he expressed.
Tesla CEO Elon Musk added his agreement in response to a post by Sequoia partner Shaun Maguire, noting that Huang “did something incredibly foolish” that was “harmful to America,” but asserting that “Jensen is irreplaceable for America’s AI leadership.”
U.S. President Donald Trump stated on Sunday that he had not discussed the allegations with Huang but described him as a fine individual. “I hope everything is okay. He’s accomplished such an extraordinary job,” he remarked.
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When asked whether he believed he should have acted on intelligence when it was presented to him, Trump stated: “No, I don’t think so. He seems like an honorable guy. He probably has a valid explanation. You need to listen to it.”
The New York Times previously reported that Trump was briefed on the intelligence findings about a year ago but opted not to take any action regarding the information.
Cancelled visit
Madison Huang had initially scheduled visits to South Korean AI startup Rebellions and planned a Q&A session with Kakao Mobility. However, Rebellions indicated that these events were canceled due to “unavoidable internal circumstances at Nvidia.”
Despite this, the Nvidia AI Day Seoul, a two-day event expected to attract roughly 2,000 attendees to discuss physical AI, agentic AI, and infrastructure, will continue as planned, according to reports from South Korean media. Nvidia has not yet responded to requests for comment.
Analysts indicated that an extended investigation or internal review could potentially postpone Nvidia’s investment strategies or product launches, affecting the semiconductor sector at large.
Ryu Young-ho, a senior analyst at NH Investment & Securities, mentioned that Nvidia’s competitors, like Advanced Micro Devices, might garner more attention in the short term, possibly highlighting Samsung, which has significant business connections with AMD.
Nonetheless, he noted that Nvidia’s products would be hard to substitute, thus limiting the potential impact, although shipments to China could experience further delays based on how the situation unfolds.
On Monday, South Korea’s deputy science minister stated that the government anticipated no interruptions to contracted deliveries of Nvidia graphics processing units despite the ongoing issues facing the company.