NVIDIA Shares Fall 8% as Independent Probe Opens into Targeting of Jensen Huang
Key Facts
NVIDIA shares fell about 8% in early trading on Monday after its board announced an independent investigation into reports that CEO Jensen Huang was targeted in a foreign intelligence effort. Reuters estimated that a decline of this magnitude would cut the company’s market value by about $350 billion from its previous close. In a statement issued on November 8, the board said a committee of independent directors would oversee the investigation with the help of independent outside legal counsel. It added that it saw no reason to believe U.S. national security or NVIDIA’s secrets had been compromised. In another reading of the stock’s movement, the Associated Press reported that shares were down 5% at the opening bell, after closing at $186.64 on November 6, compared with $181.60 on November 5.
NVIDIA said the investigation would examine all available information, while Chinese Foreign Ministry spokesman Guo Jiakun denied espionage allegations on Monday, describing the accusation against China as "unsupported by evidence and nothing but slander against China." In a message to company employees, Huang said he had not been faithful to his wife and apologized to her, his family and his colleagues, adding: "There is no excuse for what I did." The board affirmed its confidence in him and his leadership team. George Chen, partner and head of digital practice at The Asia Group, said the two central questions were whether Huang knew of any espionage activity and whether confidential or strategically sensitive information had been compromised. He said the answer should be based on evidence, not speculation.
The chairs of the U.S. House committees on foreign affairs, China and intelligence asked Huang to attend a closed-door briefing on November 18 about his reported ties to an executive at Megaspeed and NVIDIA’s protocols for countering foreign espionage. Lawmakers asked Huang to confirm the date or propose an alternative by November 11. The request puts the company’s leadership under political scrutiny days before its next earnings call. NVIDIA’s board did not specify the investigation’s duration or an expected completion date in its statement. The board said the independent committee would review the available information, as governance questions intersect with lawmakers’ scrutiny of security measures and related relationships.
Chris Weston, head of research at Pepperstone, said the investigation "does the stock no favors" at a time when considerable speculation surrounds the expansion of data centers. The news came as shares of NVIDIA’s Asian suppliers rebounded at Monday’s close after a selloff in AI-related stocks the previous week. TSMC rose 4.7%, while Samsung Electronics gained 0.6% and SK Hynix rose 0.4%. In South Korea, a vice minister of science said the government did not expect contracted deliveries of NVIDIA graphics processing units to be disrupted despite the challenges facing the company. Madison Huang, Jensen Huang’s daughter and a company executive, also canceled a planned visit to Seoul to attend an NVIDIA conference.
The developments come as investors’ focus on the company depends on the performance of its data-center business, which recorded revenue of $89.0 billion in the second quarter of fiscal 2027, up 117% year over year. Total revenue was $96.2 billion in the quarter ended July 26, 2026, up 18% from the previous quarter and 106% from a year earlier. Huang said when announcing the results that demand was "accelerating," pointing to growth among AI labs and startups and the expansion of leading labs. In the context of corporate oversight, Reuters reported that Huang owns about 3.6% of NVIDIA shares, making him its fifth-largest shareholder, according to LSEG data. Investors are awaiting the third-quarter earnings call on November 17, while lawmakers requested the briefing for the following day.
Analysts warned that a prolonged investigation or internal review could delay NVIDIA investment decisions or product launches, with potential repercussions for the semiconductor industry. The coming days’ milestones are tied to the company’s results and the congressional briefing request: the third-quarter call is scheduled for November 17, and the requested briefing for November 18. Lawmakers also asked Huang to confirm the date or propose an alternative by November 11. The company says the committee of independent directors will examine all available information, while its board said it had no reason to believe NVIDIA’s secrets or U.S. national security had been compromised. The board has not announced a timeline for completing the investigation.