Nvidia Shares Rise 2.9% in Nov. 11 Session as Board Probe and Lawsuit Continue
Key Facts
Nvidia shares rose 2.9% during Wednesday's Nov. 11 session, according to the Associated Press, in a rebound for artificial intelligence stocks. The move came as the company faced scrutiny over reports of alleged foreign intelligence targeting of its chief executive and founder, Jensen Huang. But the gain refers to regular trading and does not establish what happened to the stock after the close. The agency reported that the stock fell 4.3% on Monday, then was down about 5.5% at Tuesday's close. Those figures refer to two earlier sessions, while the after-hours move on Nov. 11 could not be verified.
Nvidia's board announced on Nov. 8 that it had opened an independent investigation after reports said Huang had been the target of a foreign intelligence effort. The company said a committee of independent directors would oversee the investigation, assisted by independent outside legal counsel. Reuters reported that the board had retained John Kim, a partner at Wachtell Lipton and former acting U.S. attorney for the Southern District of New York, to lead the investigation. The board said it had no reason to believe national security or Nvidia's secrets had been compromised. It also reaffirmed its confidence in Huang and the leadership team, and said it would provide further updates as appropriate.
Scrutiny intensified after a shareholder sued Nvidia and Huang, accusing them of misleading investors in their responses to media reports about the alleged relationship and its national security implications. The lawsuit seeks to represent investors who bought company shares from Oct. 9, 2025, through Nov. 8, 2026. It also seeks unspecified damages and a jury trial. The case comes alongside the company's internal investigation, while the Associated Press said the Justice Department had opened its own investigation. The filing of the lawsuit does not establish the allegations it contains.
Media reports linked the case to allegations concerning chip shipments to China and U.S. export restrictions. Reuters reported allegations that Huang's relationship with Alice Huang had helped ship at least $7.5 billion worth of chips to China, but said it could not independently verify those reports. It also cited reports estimating that about 240,000 chips of the H100 and H200 models and some A100s had reached China, without independently verifying them. The agency reported that China's Foreign Ministry described the espionage allegations as "groundless." The Associated Press reported that Megaspeed had faced scrutiny over allegations of evading export restrictions, which the company denied.
Reuters had reported that Nvidia lost about $430 billion in market value over two sessions, and that its shares had fallen 9.5% from when news of the alleged relationship emerged through Nov. 10. The agency said the stock had been nearly flat for the year before the news spread, and that investors were also concerned about whether massive artificial intelligence spending could generate sufficient returns. Amid the political pressure, Reuters cited Republican Sen. Kevin Cramer calling on Huang to step down, pointing to the possibility of blackmail tied to the sensitivity of the company's chips. The Associated Press reported that three Republican lawmakers had asked Huang for a closed-door briefing on security protocols and his interactions with a woman accused of spying for China. The chairman of a House select committee raised the possibility of subpoenaing him if he did not respond to the request by the end of Wednesday.
The Associated Press said Huang would remain chief executive during the investigation, and a Nvidia spokesperson said the news would not slow the company and that Huang was committed to continuing to lead it without interruption. The agency reported that the company did not immediately respond to its request for comment on the possibility of a subpoena. U.S. President Donald Trump said, according to Reuters, that he had spoken with Huang and asked whether he knew the woman was a spy, and that Huang replied he "had absolutely no idea," adding that he believed the chief executive. The board said it would provide further updates as appropriate. Those updates and the next steps in the investigation and lawsuit remain expected developments in the case.