Nvidia Shares Slide as Board Probes Huang Spy Claims

Nvidia shares fell sharply on Monday after the chipmaker’s board said it had opened an independent investigation into chief executive Jensen Huang’s relationship with a Chinese business executive alleged to have passed information to Beijing, Al Jazeera and Reuters reported.

The stock dropped more than 4% as US markets opened, according to Al Jazeera, and was down nearly 6% around midday, Fox Business reported. The slide came even as the broader market rallied, with the Nasdaq, S&P 500 and Dow all trading higher in early deals.

Board launches independent review

Nvidia announced the inquiry on Sunday. According to Fox Business, the review is being carried out by outside independent counsel and a committee of independent directors.

In its statement, the board said it prioritises US national and economic security, which it described as paramount to the interests of the company and its shareholders. It added that it had no reason to believe that national security or Nvidia secrets had been compromised, but that its inquiry would examine all available information.

The board also expressed confidence in Huang and his leadership team, Fox Business reported.

Al Jazeera, citing The New York Times, said the newspaper reported in October that Huang had a relationship with a former executive at Singapore-based Megaspeed, which describes itself on its website as a core partner of Nvidia’s computing power cloud business in the Asia-Pacific region. US authorities reportedly concluded the executive was a Chinese intelligence asset, according to Al Jazeera.

Huang apologises, pledges cooperation

In a separate statement on Sunday, Huang apologised for being unfaithful to his wife and said he backed the investigation and would cooperate fully, according to Al Jazeera and Fox Business.

China’s Foreign Ministry rejected the allegations. Spokesperson Guo Jiakun described the spy narrative as a groundless accusation and a smear, Al Jazeera reported.

US President Donald Trump defended the Nvidia chief on Sunday, calling him “an honorable guy” and saying he had not heard that Huang had done anything wrong, Fox Business reported.

Investors weigh leadership risk

Nvidia carries a market value of about $4.5 trillion. Huang is the company’s fifth-largest shareholder with a 3.6% stake, according to LSEG data cited by Al Jazeera, but does not hold majority voting control.

Analysts are sceptical that Huang will step down, Al Jazeera reported. Michael Monaghan, portfolio manager of the Founders 100 ETF, said his removal looked “highly improbable” based on current information.

Daniela Hathorn, senior market analyst at Capital.com, said in comments carried by TheStreet that there was no confirmed indication Huang would step down and that the controversy did not necessarily change Nvidia’s underlying demand outlook. She added that, given his central role in the company’s success, even speculation about leadership uncertainty could unsettle investors.

What’s next

Neither Nvidia nor the reports set out a timeline for the board’s investigation. Hathorn said investors are also weighing concerns about AI profitability, elevated borrowing costs and possible regulatory changes following the US midterm elections.

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