Shares fell more than 3% Tuesday, following a decline of more than 4% the previous session, after The Information reported that a Singapore-based executive Jensen Huang had an affair with allegedly aided the movement of Nvidia hardware to Chinese companies. The report, attributed to two people familiar with the matter, alleged that roughly $7.5 billion in Nvidia chips reached China since 2023 through a network connected to that executive.
What The Information Reported
The outlet alleged that approximately 240,000 advanced Nvidia chips entered China through a reported distribution network, including hardware subject to U.S. export restrictions.
Citing two unnamed sources, The Information identified three companies as part of the reported supply chain: Shanghai Century Litong, Singapore-based Megaspeed, and a Malaysian Megaspeed subsidiary called Speedmatrix. Alice Huang, the executive at the center of the report, previously held a role at Megaspeed. These remain allegations attributed to unnamed sources; Nvidia has not confirmed the shipment figures or the described distribution network.
Nvidia Opens an Independent Investigation
The company’s board launched a probe into whether Huang was targeted by a foreign intelligence operation, a matter separate from his personal admission.
Nvidia said it is conducting an independent investigation into reports that Jensen Huang was the target of a foreign intelligence operation. Separately, Huang acknowledged an affair and issued an apology to his wife and the company, but did not publicly identify the person involved. The investigation concerns a potential intelligence exposure; the apology concerns personal conduct.
Federal and Congressional Reaction
President Trump confirmed an FBI inquiry while expressing support for Huang, as a senior House Democrat called for more information.
President Donald Trump confirmed that the FBI is looking into the matter and expressed support for Huang, according to NBC News. House Democratic Leader Hakeem Jeffries called for additional information and said there were serious concerns requiring congressional attention. Reuters reported that Jeffries also called for tighter restrictions on chip sales to China.
Beijing Denies the Allegations
Chinese authorities rejected the claims as unsubstantiated.
Chinese authorities denied that Beijing attempted to ensnare Huang and described the underlying allegations as unsubstantiated, according to reporting by AP and NBC News.
Broader Market Pressure Added to the Decline
The sell-off coincided with wider market weakness, though rival chip stocks fared comparatively better.
Nvidia’s decline occurred during a period of broader market pressure. Rival chip stocks AMD and Broadcom held up comparatively better during the same period, suggesting some investor rotation away from Nvidia amid the unresolved uncertainty.
Key Questions Still Unresolved
No finding has been publicly reported that Nvidia knowingly violated export controls or that Huang participated in any diversion of restricted hardware.
Investigators still need to determine whether restricted chips actually reached China and whether Nvidia personnel or distributors facilitated those transfers. A separate question is whether any confidential business or technical information was obtained or transmitted. The scope of Nvidia’s internal investigation and any government disclosures will determine how much of the $7.5 billion allegation holds up and what legal or regulatory consequences, if any, follow.
