Summary

  • Nvidia’s board said it has opened an independent investigation into allegations of Chinese intelligence espionage activity targeting CEO Jensen Huang.
  • Nvidia said there has so far been no sign of any breach involving national security or confidential information, and it reaffirmed its trust in Huang.
  • The U.S. Congress said it plans to investigate allegations related to Huang and Nvidia’s security management system and its China business.

Forecast Trend Report by Period

Nvidia’s board has opened an independent investigation into reports that Chief Executive Officer Jensen Huang was targeted by Chinese intelligence, after Huang acknowledged having an extramarital affair. U.S. intelligence officials believe Huang was in a romantic relationship with a businesswoman suspected of having been recruited by China’s intelligence services. The episode has expanded into a national security controversy as Washington moves to block advanced artificial intelligence chips from reaching China.

In a statement issued on November 8, Nvidia’s board said it was launching an independent investigation “in connection with recent reports that founder and CEO Jensen Huang was targeted by a foreign intelligence service.” A committee of independent directors, advised by outside counsel, will oversee the probe. The board said U.S. national security and economic security were its top priorities and that it would closely review all information obtained during the investigation.

The board said, however, that it had found no credible evidence that national security or Nvidia’s confidential information had been compromised. It also reaffirmed its confidence in Huang and the company’s management.

Huang, in a message sent to employees the same day, admitted the affair and issued a public apology. “I was unfaithful to my wife,” he wrote. “My actions hurt my wife and children, and there is no excuse for them. I take full responsibility for my actions and for the pain they caused.”

He said his family had given him love and support throughout his life, but that he had let them down. He added that he knew an apology could not undo his actions and hoped to regain his family’s trust over time. Huang also apologized to Nvidia employees, the board, partners and shareholders, saying it had been the privilege of his life to lead Nvidia and that he would work to rebuild trust.

On the national security issue, Huang said he fully supported the board’s independent investigation and would cooperate fully. He added that he loved his country and the company and would do everything possible to protect Nvidia and safeguard U.S. national security. Huang did not identify the other person involved in the affair.

The controversy began with media reports that U.S. intelligence agencies had identified a relationship between Huang and a businesswoman suspected of having ties to Chinese intelligence.

The Financial Times reported that U.S. officials earlier this year drafted a memo based on intelligence materials stating that Huang had been romantically involved with a woman named Alice Huang. Alice Huang is a former executive at Megaspeed, a Singapore-based Nvidia customer. U.S. intelligence agencies suspect she was recruited as an asset by China’s Ministry of State Security, the country’s main intelligence service.

The memo was circulated to a small group of senior U.S. officials shortly before President Donald Trump departed for Beijing in May for a summit with Chinese President Xi Jinping, the report said. The White House and the Central Intelligence Agency declined to comment.

U.S. intelligence officials suspect Alice Huang may have approached Huang in an effort to gather information related to advanced AI semiconductors and the direction of U.S. government policy. It has not been established, however, whether she in fact worked on behalf of Chinese intelligence or whether Nvidia secrets or U.S. national security information were passed to China.

When the allegations first surfaced, Nvidia said the pair’s contact reflected a routine customer relationship. The company said Huang meets thousands of customer executives each year and that his dealings with Alice Huang were not unusual. The controversy entered a new phase after Huang admitted the affair and the board decided to open an independent investigation.

The episode also intersects with a separate U.S. investigation into Megaspeed over suspected violations of U.S. semiconductor export controls.

Megaspeed is a Singapore company that buys Nvidia’s advanced AI chips and provides computing services to data-center customers. U.S. authorities have been investigating whether the company helped route Nvidia’s high-performance semiconductors into China in violation of export controls. Nvidia said it also conducted its own review but found no evidence supporting allegations of wrongdoing.

The U.S. has restricted semiconductor exports to China over concerns that Beijing could use advanced AI chips for military purposes. Washington has been watching particularly closely for shipments of high-performance semiconductors reaching China through Southeast Asian countries including Singapore.

Huang has pushed to expand chip sales to the Chinese market despite those U.S. restrictions. Earlier this year, he was reported to have personally urged President Trump to allow Nvidia to export its H200 high-performance AI chips to Chinese customers. There were also reports that U.S. national security officials had voiced dissatisfaction with Huang’s efforts to expand business in China.

The controversy has also been fueled by Huang’s close relationship with Trump. Huang visited the White House several times after Trump’s second term began last year. During Trump’s trip to China in May, Huang boarded Air Force One in Alaska. He also attended a state dinner during Xi’s visit to the U.S. in September.

Congress is also moving to investigate. House Foreign Affairs Committee Chairman Brian Mast, House Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party Chairman John Moolenaar, and House Intelligence Committee Chairman Rick Crawford, all Republicans, asked Huang to appear at a closed-door joint briefing by the three committees on November 18.

The lawmakers plan to examine how Huang came into contact with Alice Huang and what internal security procedures Nvidia has in place to respond to espionage attempts by foreign intelligence services. They asked Huang to confirm by November 11 whether he would attend or to propose an alternative schedule.

Democratic Senator Chris Coons also signaled a congressional investigation. He said lawmakers would seek to clarify the relationship among the Trump administration, Chinese espionage activity and chief executives at AI companies.

Questions are also growing over whether Huang will remain in charge of the company. Nvidia spokesman John Rizzo told Axios that the episode would not slow the company’s progress and that “Jensen will continue to lead Nvidia as CEO without interruption.”

The core issue in the controversy is not Huang’s private life itself, but whether Chinese intelligence tried to approach the chief executive of a critical U.S. AI company to obtain information or influence corporate decision-making. Huang’s admission of an affair is separate from the question of whether Chinese espionage actually occurred.

Nvidia’s independent investigation and congressional scrutiny are expected to focus on whether any secrets were leaked, how management handled security controls and whether Chinese intelligence may have exercised influence.

Kim Ju-wan, Hankyung.com reporter [email protected]

Korea Economic Daily