The investigation and the allegations
Nvidia announced on Sunday an internal investigation to establish whether its CEO, Jensen Huang, had been the target of a foreign intelligence operation, according to The Korea Herald. The review follows an article in The New York Times, cited by the source, according to which Huang had a close relationship with Alice Huang, a former executive at Singapore-based company Megaspeed, whom U.S. authorities had concluded was a Chinese intelligence asset. Alice Huang, the source specifies, did not respond to The New York Times, and Reuters was unable to locate her.
Huang told employees that he had been unfaithful to his wife, without providing details about the relationship. Chinese Foreign Ministry spokesperson Guo Jiakun called the so-called Chinese spy narrative an unfounded accusation, slander and defamation. Megaspeed did not immediately respond to a request for comment, also because Monday was a public holiday in Singapore.
Leadership and corporate structure
The investigation calls into question Huang's future at a time when Nvidia is the world's most valuable chipmaker and its CEO is considered the most prolific salesperson of the artificial intelligence boom. Huang holds about 3.6% of the shares and is the fifth-largest shareholder, according to LSEG data cited by the source, and maintains tight control through an unusually flat structure in which dozens of executives report directly to him. Unlike Meta Platforms or SpaceX, Nvidia does not have dual-class shares that would guarantee the co-founder control of a majority of the votes.
The board of directors has expressed confidence in Huang. Some analysts, the source reports, believe there is no natural successor within the company should he decide to step down. Chris Weston, head of research at Melbourne-based broker Pepperstone, said the market is signaling that the affair is not helping the stock at a time of speculation about data center construction, but added that he does not believe Huang will be replaced: if the market truly believed he would step aside, the stock would suffer a much sharper selloff.
The market and reactions
On Monday, Nvidia shares fell nearly 5% in premarket trading in the United States, extending the previous week's decline and pushing the stock to its lowest levels in months. At current levels, according to the source, the company would lose about $250 billion in value compared with the last close. The fallout from the affair has also reached South Korea: Madison Huang, the CEO's daughter and an Nvidia executive, canceled a planned visit to Seoul for a company conference that began on Monday, according to the companies she was due to meet. Planned stops at South Korean startup Rebellions and Kakao Mobility were canceled due to unavoidable internal circumstances at Nvidia, while Nvidia AI Day Seoul will proceed as planned, according to South Korean media.
Several figures have weighed in on the affair. Billionaire investor Bill Ackman wrote on X that Huang is an extraordinary person, but that if this is more than an extramarital relationship, the problem is real, expressing the hope that it is simple infidelity and not a national security risk. Tesla CEO Elon Musk commented "I agree" on a post by Sequoia partner Shaun Maguire, according to which Huang has done something very stupid and damaging to America, but remains irreplaceable for U.S. leadership in AI. President Donald Trump said on Sunday that he had not spoken with Huang about the allegations, calling him a good person and an honorable man, and added that he did not believe he should have acted on the intelligence information he received, arguing that perhaps there is an explanation. The source reports that The New York Times wrote that Trump had been informed of the findings about a year ago and had chosen to do nothing.
The consequences to be verified
According to the analysts cited, a prolonged investigation or internal review could delay Nvidia's investment decisions or product launches, with broader implications for the semiconductor industry. The source also notes that South Korean manufacturers Samsung Electronics and SK hynix could face stricter export compliance requirements if U.S. authorities step up controls on Nvidia's AI chip shipments to China. Meanwhile, Nvidia's Asian suppliers have recovered part of their losses: TSMC closed up 4.7%, Samsung up 0.6% and SK hynix up 0.4%. The outcome of the internal investigation, the actual nature of the relationship and any consequences for supplies and investments remain to be clarified.
