$4.8 Billion AI Equipment Purchase Links Megaspeed to U.S. Probe Into China

Key Facts

Reporting published on October 29 said U.S. officials had concluded that Alice Huang, an executive at Singapore-based Megaspeed, was gathering information for Beijing. The report was based on interviews with people briefed on the surveillance and other sources, and quoted officials as saying Huang was “a Chinese intelligence asset passing information to Beijing.” Her surveillance, according to the report, revealed that she had developed a close relationship with Jensen Huang, Nvidia’s chief executive. The report does not say that Huang knew about or participated in her alleged information gathering. The case thus concerns personal and business ties in the context of a U.S. investigation into a company operating in the AI chip supply chain to Asia.

U.S. President Donald Trump was briefed on the intelligence findings about a year ago, according to the report, but took no action. Huang did not receive a warning briefing from U.S. intelligence agencies, while surveillance of Alice Huang continued. A Nvidia spokesperson said the chief executive’s meetings with her were “not unusual or unexpected.” The spokesperson added that the company was investigating allegations of chip smuggling to China and had rebutted those claims. The report offered no evidence that Huang knew of the intelligence suspicions or that his meetings with Alice Huang went beyond his usual business activities.

Megaspeed said it had retained outside legal counsel to conduct a thorough internal investigation and had told the U.S. government it was prepared to cooperate. The company has been under U.S. investigation since late 2024, according to the report, after an official from the U.S. Commerce Department visited a data center in Malaysia. Malaysia is directly relevant to the case because Megaspeed’s sister company there bought advanced AI equipment containing Nvidia chips and technology. The purchases totaled at least $4.8 billion between June 2024 and February 2026, according to trade records obtained by ImportGenius. The scale of the purchases places both companies’ activities under U.S. scrutiny over the destination and use of advanced computing equipment.

Megaspeed operates, according to the report, among companies in Southeast Asia that buy chips to build data centers and then rent their computing capacity to companies in China, including Alibaba and other Chinese firms. This activity intersects with U.S. export controls on advanced semiconductors, which the Commerce Department revised during fiscal 2024 to expand licensing requirements. The expanded requirements covered more than 40 additional countries, as well as companies headquartered in China and operating around the world, according to the department’s annual performance report. A spokesperson for the Chinese Embassy in Washington said the United States was making “baseless slanders and false accusations.” These positions place the case within broader tensions over Chinese companies’ access to advanced AI technology, without resolving the allegations in the report.

In trading, Nvidia shares closed at $215.38 on October 28, compared with a close of $217.94 the previous day. The stock had closed at $212.21 on October 22, then $210.96 on October 23, before reaching $216 on October 26. These prices do not establish that the stock’s movement was linked to the report, and the data provided do not include prices for other semiconductor companies. In the October 29 session, U.S. stock indexes fell as Alphabet shares dropped after weaker-than-expected growth, amid concerns about returns on AI investment. The Associated Press reported that Alphabet’s capital spending exceeded $51 billion in its latest reported quarter, weighing on free cash flow and raising questions about funding its expansion.

These questions coincide with a broader debate over whether data center and chip investments can generate profits and productivity to justify their cost, as borrowing costs add pressure to future spending, according to the Associated Press. Jensen Huang said on Nvidia’s fiscal 2027 second-quarter earnings call that $50 billion in data centers reflected the productivity of the company’s technology. Nvidia is scheduled to hold a call to discuss its fiscal 2027 third-quarter results on November 17. The results could refocus investors on demand and spending as they follow the U.S. case involving Megaspeed. As for the internal investigation, the company said it would conduct it through outside legal counsel and was prepared to cooperate with the U.S. government.