Nvidia CEO Jensen Huang has admitted to an extramarital affair with a business executive, Alice Huang, who U.S. intelligence agencies allege is a Chinese spy. In an email to employees and a message to the board, Huang acknowledged his infidelity and pledged cooperation with investigations. The revelations have sparked a crisis for the AI chipmaker, as U.S. intelligence believes the woman was gathering information for Beijing.
Nvidia's board of directors has launched an independent investigation to determine if Huang was the target of a foreign intelligence operation and whether sensitive company secrets were compromised. Simultaneously, shareholders have filed a lawsuit against the company and its CEO, accusing them of defrauding investors by misleading them about the affair.
The controversy caused significant turmoil on Wall Street, with Nvidia shares tumbling as much as 8.8%. The drop erased hundreds of billions of dollars in market valuation, with some reports indicating a loss of nearly $400 billion. While some analysts suggest the company's underlying business remains strong, investors are expressing concern over the lack of a clear succession plan for the co-founder.
President Donald Trump confirmed that the FBI is investigating the affair but expressed support for Huang, stating he does not believe the CEO has a reason to worry. Trump described Huang as a fine person who has done an incredible job. Meanwhile, a Chinese state-run newspaper denied any link to the affair, calling the spy narrative fabricated and a smear campaign against Beijing.
The scandal raises critical national security concerns given Nvidia's role in the global AI industry and the vital nature of its chips to U.S. technology and military. There are further concerns that the situation could complicate Nvidia's lobbying efforts to loosen U.S. chip export restrictions and maintain access to the Chinese market.