FBI opens probe into Nvidia chief's ties to alleged Chinese spy

The Federal Bureau of Investigation is examining the personal relationship between Nvidia Chief Executive Jensen Huang and an alleged Chinese intelligence officer. President Donald Trump made the announcement during a White House press briefing on Tuesday. He stated that he had spoken directly with Huang about the matter. Trump characterized Huang as a very honorable man and expressed confidence that the executive would be in good shape following the inquiry.

The investigation follows a report from the New York Times alleging that Huang had a close relationship with Alice Huang. She is not related to the Nvidia CEO. The paper reported that US intelligence agencies determined Alice Huang, a former executive at the Singapore-based firm Megaspeed, was gathering information for Beijing. Jensen Huang admitted to an extramarital affair with a business executive in an open letter posted on the company's website. He did not name the woman but apologized to his wife and the company.

Nvidia announced on Sunday that it is conducting an independent investigation into claims that its leader was the target of a foreign intelligence effort. The company stated it has no reason to believe that national security or its own secrets were compromised. In his letter, Huang said he supported the investigation and would cooperate fully. He noted that news reports regarding the relationship and potential security concerns prompted the board to act.

China reacted swiftly to the allegations. On Monday, Beijing denied that it attempted to ensnare Huang. Chinese officials called the spying claims unsubstantiated and part of a smear campaign. The state-owned Global Times suggested that the New York Times report was aimed at destabilizing US-China relations. The publication noted that such accusations often appear when relations begin to improve.

The controversy has caused immediate financial fallout. Nvidia shares fell by 4.27 percent on Monday. That drop wiped approximately $200 billion from the company's market value in a single trading session. Huang's personal stake in the company lost billions of dollars in value. By early Tuesday in extended trading, the stock had recovered about 1 percent. The broader market showed strength, with the S&P 500 posting its largest daily percentage gain since April 8.

Investors are watching to see if the situation affects Huang's leadership. Most analysts do not expect him to step down. Stacy Rasgon, an analyst at Bernstein, said that Huang clearly sets the long-term strategy and direction of the company. He added that Huang is not an ordinary CEO and pulls most of the company's strings himself. Despite this, some shareholders have filed a proposed class action lawsuit. They accuse Nvidia of defrauding investors by concealing the ties to the suspected spy.

The investigation occurs at a sensitive time for trade between the two nations. Restrictions in the US and China currently block Nvidia from selling its advanced H200 chips to Chinese firms. This barrier potentially costs the company billions in lost sales. In recent years, Huang has lobbied Washington to loosen these limits. He won Trump's approval this year to sell the H200 chips. Trump is scheduled to meet with Chinese President Xi Jinping at the Asia-Pacific Economic Cooperation summit next week. He said he did not think he would bring the situation up during their talks, though he acknowledged Xi might ask.

Nvidia produces the dominant computer chips that fuel the artificial intelligence boom. The company is one of the world's most valuable publicly traded firms. It powers major systems including ChatGPT and Google's Gemini. It also drives the UK's most powerful supercomputer. China has set a 2030 deadline to surpass American AI capabilities, making the stability of its chip supply a key strategic priority.