On Sunday, Nvidia announced it is investigating whether CEO Jensen Huang has been a target of a “foreign intelligence effort,” following a media report suggesting he had a close association with a Chinese businesswoman who allegedly conveyed information to Beijing.
In a message to employees, Huang acknowledged his infidelity and accepted “full responsibility” for his actions, while Nvidia confirmed that he remains dedicated to leading the company without any disruptions.
These developments could exert pressure on the chipmaker’s stock, which has already experienced significant declines due to concerns about the sustainability of AI, and may also raise questions regarding Huang’s future as the leader of the company he co-founded.
The New York Times reported last month that Huang had a relationship with a former executive of a Singapore-based firm that U.S. authorities investigated, concluding that she was an asset for Chinese intelligence.
In light of recent reports, the Nvidia board stated, “An independent investigation is being initiated regarding the allegations that founder and CEO Jensen Huang has been the target of a foreign intelligence effort. A committee of independent directors, together with outside independent counsel, will supervise the investigation.”
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The global tech company mentioned on Sunday that although its board does not believe that either U.S. national security or Nvidia’s proprietary information has been compromised, the investigation will review all pertinent information.
Nvidia expressed confidence in Huang and his leadership team, stating that the CEO is fully supportive of the review and is committed to cooperating with it.
‘He’s an honourable guy,’ Trump says
President Donald Trump remarked on Sunday that he had not discussed the allegations with Huang but described him as a good individual.
“I hope everything’s alright. He has done an incredible job,” Trump added.
When asked if he felt he should have acted on the intelligence brief he received, Trump replied, “No, I don’t think so. I believe he’s an honourable guy. He likely has an explanation for it. You need to hear it.”
Huang and U.S. President Donald Trump are shown in Washington on Oct. 8. (Julia Demaree Nikhinson/The Associated Press)
The New York Times reported that Trump received a briefing on the intelligence findings about a year ago and chose not to take any action based on the information.
Secretary of State Marco Rubio declined to comment on Huang when approached by reporters on Sunday evening.
China’s Ministry of Foreign Affairs has not yet responded to a Reuters request for comment.
Huang, who established the company in 1993, stated that he is “dedicated to safeguarding Nvidia and supporting America’s national security.”
‘Black eye moment for Jensen’
The investigation adds to the pressure on Nvidia at a time when investors are already hesitant due to uncertainty surrounding the sustainability of the artificial intelligence market, where the company holds a leading position.
The shares of the $4.5 trillion chipmaker have lost all their gains for the year as the broader tech market experiences a downturn stemming from concerns about AI sustainability.
Dan Ives, partner and senior managing director at Yorkville Ives & Co., commented, “There is a clear risk that Jensen could be removed as CEO based on the board’s investigation, which will add risk to the stock as he is crucial to Nvidia’s narrative and strategy worldwide.”
The artificial intelligence boom is driving a worldwide shortage in memory chips that could soon drive up prices in everything from smartphones to laptops to video game consoles.
Ives further stated, “This is a black eye moment for Jensen and will likely trigger multiple congressional inquiries at a minimum, creating an overhang on the stock,” adding that the news may also increase scrutiny over chip sales to China.
Huang acknowledged his infidelity, expressing, “My actions have hurt her and our children. There is no justification for what I did. I am truly sorry.”
Addressing his colleagues, board members, partners, and shareholders, Huang remarked, “My duty is to serve you and be deserving of your trust. I have not met that responsibility. I am completely devoted to Nvidia and will strive to regain your confidence.”
Huang delivers a speech at a company event in Berlin on Oct. 21. (Markus Schreiber/The Associated Press)
In late October, he told Bloomberg News that his relationship and communications with the Chinese businesswoman were “entirely normal and not unusual.”
Josh Gilbert, lead analyst at trading platform eToro, noted that Huang’s influence is evident in every aspect of the company’s success, so any uncertainty regarding his position would be significant for shareholders.
“While the investigation may dampen sentiment, it won’t change anything long term unless it results in a leadership change, at which point it becomes a completely different situation,” Gilbert remarked.
Lawmakers express security concerns
Prominent Republican lawmakers in the U.S. House of Representatives have already urged Huang to brief Congress this month concerning the New York Times report.
The article raises “significant national security concerns regarding [China’s] access to sensitive U.S. technology and information,” Republican lawmakers stated in a letter dated Nov. 4. “It is crucial for Congress to ascertain the extent to which U.S. national security has been jeopardized.”
Since 2022, U.S. export controls have aimed to limit China’s access to advanced Nvidia chips and the machinery required to produce them.