Nvidia’s stock suffered a significant decline on Monday following an internal inquiry regarding whether CEO Jensen Huang was the target of a foreign intelligence operation, raising questions about his future with the AI chip company.
The investigation was initiated after reports surfaced about Huang’s close ties to a Chinese businesswoman accused of sharing information with Beijing. Huang admitted to Nvidia employees that he had been unfaithful to his spouse but did not provide specifics about the relationship.
This inquiry, which was made public on Sunday, has cast doubt over Huang’s future, particularly since Nvidia is recognized as the globe’s most valuable chip manufacturer and Huang is seen as a key figure in the AI industry’s expansion.
Known for his leather jacket, Huang enjoys a rock star-like reputation globally, especially in Asia, where he frequently interacts with fans, posing for selfies and signing autographs for his ardent supporters.
According to LSEG data, Huang holds approximately 3.6 percent of Nvidia’s shares, making him the fifth-largest shareholder, and he maintains direct control over the company through a flat management structure that sees numerous executives reporting directly to him.
However, unlike companies such as Meta Platforms or SpaceX, Nvidia does not have a dual-class share system that would allow its co-founder to retain majority voting rights.
The repercussions of the inquiry reached South Korea, where Madison Huang, the CEO’s daughter and an Nvidia executive, canceled her scheduled visit to Seoul for an Nvidia conference that was supposed to commence on Monday, as reported by the companies she was meant to meet.
Nvidia’s stock price fell by about six percent, reaching its lowest intraday point since March 31.
Chris Weston, head of research at brokerage Pepperstone in Melbourne, Australia, commented, “The market is likely indicating that this situation is not beneficial for the stock, particularly during a time filled with speculation about the construction of data centers.”
Despite this, Weston expressed doubt that Huang, referred to as the “godfather of AI,” would be replaced.
“If we genuinely believed he would resign… the stock would be significantly lower — it would be a complete disaster, to be frank,” he added.
Nvidia reassured that its board members have confidence in Huang. Some analysts have suggested there is no clear successor within the company should he choose to step away.
The New York Times reported last month that Huang was linked to Alice Huang, an unrelated former executive from Singapore’s Megaspeed, who was investigated by U.S. authorities and determined to be a Chinese intelligence asset.
Guo Jiakun, a spokesperson for the Chinese Foreign Ministry, described the allegations of a Chinese espionage narrative as “entirely unfounded, slanderous, and defamatory” during a press briefing in Beijing.
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 respond promptly to a request for comment on Monday, a public holiday in Singapore.
Alice Huang did not reply to the New York Times last month regarding her connection with Jensen Huang, and Reuters was unable to ascertain her whereabouts for comment on Monday.
Asia partners unaffected
Shares of Nvidia’s major Asian chip suppliers recovered on Monday after last week’s decline in AI-related stocks, with TSMC rising 4.7 percent, while Samsung Electronics and SK Hynix increased by 0.6 percent and 0.4 percent, respectively.
Notable figures have expressed their views on Huang’s admission. Billionaire investor Bill Ackman, founder of Pershing Square Capital Management, remarked on X that the Nvidia CEO is an “incredible human,” but if “this is more than just an affair, it poses a serious issue.”
“I hope it’s merely an affair and not a national security concern,” he stated.
Tesla CEO Elon Musk also weighed in, stating, “I agree,” in response to a post by Sequoia partner Shaun Maguire, who claimed Huang “did something incredibly foolish” that was “harmful to America,” but noted that “Jensen is irreplaceable for America’s AI leadership.”
U.S. President Donald Trump mentioned on Sunday that he had not discussed the allegations with Huang but referred to him as a good person. “I hope everything is okay. He has done such an extraordinary job,” he added.
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When asked if he believed he should have taken action based on intelligence information he received, Trump replied: “No, I don’t think so. I believe he is an honorable individual. He probably has a justification for it. You need to hear it.”
The New York Times reported that Trump was informed about the intelligence findings approximately a year ago and opted not to act on that information.
Cancelled visit
Madison Huang had previously intended to visit the South Korean AI startup Rebellions and conduct a question-and-answer session with Kakao Mobility. Rebellions stated that the events were canceled due to “unavoidable internal circumstances at Nvidia.”
The Nvidia AI Day in Seoul, a two-day event anticipated to attract around 2,000 attendees to discuss various aspects of AI, is still scheduled to proceed as planned, according to reports from South Korean media. Nvidia has not yet responded to a request for comment.
Analysts have indicated that a lengthy investigation or internal assessment could delay Nvidia’s investment strategies or product releases, which may have wider ramifications for the semiconductor sector.
Ryu Young-ho, a senior analyst at NH Investment & Securities, noted that Nvidia’s competitors, such as Advanced Micro Devices, could gain more visibility in the short term, potentially spotlighting Samsung, which maintains close business relations with AMD.
Nevertheless, he mentioned that Nvidia’s products would be challenging to replace, which would limit the overall impact, though shipments to China might experience additional delays depending on how the situation unfolds.
On Monday, South Korea’s deputy science minister stated that the government anticipates no disruptions in the contracted supply of Nvidia graphics processing units, despite the ongoing challenges facing the company.
