Shares Slide Consecutively With Market Value Sharply Evaporating
After falling 4.3% in the previous trading session, Nvidia shares dropped another 5.47% today, with more than US$470 billion in market value evaporating at one point over two consecutive trading days, while Microsoft briefly overtook Nvidia to become the world's 2nd-largest company by market capitalization. Concerns have deepened over alleged rumors involving CEO Jensen Huang and a Chinese businesswoman, and the fallout from allegations that the woman engaged in espionage for Beijing. Investors are also increasingly worried about whether massive corporate spending on artificial intelligence infrastructure can deliver commensurate returns.
US$7.5 Billion Chip Flows and Investigation Progress
Tech outlet The Information cited two people familiar with the matter as reporting that the relationship between Jensen Huang and Huang Le helped facilitate shipments of Nvidia chips worth at least US$7.5 billion to Chinese companies, adding that the two are not related. The report said Huang Le, along with her husband and sister, built a corporate network in China and Singapore centered on Shanghai Century Litong in China, which obtained Nvidia Preferred Cloud Partner status in 2023. She helped move about 240,000 H100, H200 and some A100 chips into China, some of them products prohibited for sale to China, some used by Alibaba, Tencent and smaller AI labs, as well as renting out computing power to operate data centers.
Huang Le also served as a senior executive at Singapore-registered Megaspeed, which is under investigation by U.S. authorities for allegedly helping move Nvidia chips from Southeast Asia to China. The report said she leveraged her relationship with Jensen Huang to boost credibility, while deliberately obscuring her actual role and avoiding leaving a paper trail. Nvidia's board of directors launched an internal investigation on the 8th, hiring former Acting U.S. Attorney Hyun Joon Kim and the law firm Wachtell, Lipton to lead it. The U.S. Federal Bureau of Investigation is also investigating whether the 63-year-old Jensen Huang has become a target of foreign intelligence agencies. Jensen Huang has admitted to employees that he was unfaithful to his wife, but did not disclose details.
Export Controls and Market Concerns Intensify
U.S. President Trump said he spoke with Jensen Huang about the matter, with Jensen Huang saying he had no idea the woman was suspected of being a Chinese spy, and Trump said he believed his account. The New York Times reported that Secretary of State and National Security Adviser Rubio briefed Trump on related intelligence aboard Air Force One en route to China, at least the second time in the past 7 months that Trump had been made aware of related intelligence. The allegations have raised concerns about Nvidia's governance, export-control compliance and over-reliance on Jensen Huang's leadership. Bank of America analysts noted the core market debate is whether the incident is limited to a single company or will trigger regulatory restrictions and operational disruptions across the AI infrastructure industry, and unproven allegations should not be equated with commercial damage. The Financial Times cited people familiar with the matter as reporting that the U.S. Department of Commerce is delaying procedures to place Megaspeed on the Entity List, and it has not yet been listed. The U.S. Department of Commerce and Nvidia did not immediately respond to requests for comment, and Reuters said it could not independently verify the reports.