Nvidia's board said on November 8 that it is opening an independent investigation "in light of recent reporting that founder and CEO Jensen Huang has been the target of a foreign intelligence effort," according to CBS News. A committee of independent directors, working with outside counsel, will run it. The board said it has "no reason to believe" that national security or Nvidia's secrets were compromised, AP reported.
The allegation comes from The New York Times, which reported last month that U.S. intelligence agencies believed a former top executive at Megaspeed, a Singapore-based data center company and Nvidia customer, was passing information to Beijing. Huang acknowledged to the board that he had been intimate with her, according to AP. In a message to employees he said he had been unfaithful to his wife and apologized. "I support the investigation and will cooperate fully," he said.
Megaspeed is where the business risk sits. It bought more than $4.8 billion of Nvidia chips over two years, according to the Times. Two law enforcement sources told CBS that the Justice Department's National Security Division is investigating Megaspeed over possible violations of U.S. export restrictions on advanced AI chips. Megaspeed did not immediately respond to CBS.
Huang, 63, remains chief executive. Nvidia spokesperson John Rizzo said Huang "is committed to continuing to lead Nvidia as CEO without interruption." China's foreign ministry called the spy account "entirely baseless." President Trump said on Monday that Huang told him he had no idea the person was a spy, CBS reported.
Shares fell 4.3% to $178.67 on Monday, per CBS MoneyWatch, after dropping almost 20% over the previous month. As of Monday night Nvidia had filed nothing with the SEC about the review.
The board's statement covers whether Huang was targeted. It does not say whether the review will look at Megaspeed's purchases, which sit inside a China export regime that already takes a 25% cut of some Nvidia chip sales.
Bottom Line
Nvidia's board is treating this as a national security question, and the review will take time. Until it reports, shareholders carry two open risks: who leads the company, and what the Justice Department finds at one of its large Asian customers.