Nvidia loses $250bn in value after board launches probe into CEO affair

Ordinary investors saw their portfolios shrink by an estimated $250 billion on Monday. Nvidia shares fell roughly 6 percent following an announcement that the company's board is conducting an independent investigation into the personal life of its chief executive. The probe centers on an alleged extramarital affair between Jensen Huang and a woman identified in recent reports as a potential agent for Chinese intelligence.

The board stated it opened the investigation after reports indicated the founder had been the target of a foreign intelligence effort. Despite the scrutiny, the company said it had no reason to believe that corporate secrets or national security interests were compromised during the relationship.

A New York Times report detailed the allegations, noting that US intelligence officials believe Alice Huang, also known as Huang Le, spied for Beijing. She served as managing director of Megaspeed, a Singaporean firm that has done business with Nvidia. According to the report, Secretary of State Marco Rubio sent a memo to senior Washington officials in the spring warning that the Nvidia leader was in a close relationship with a Chinese spy.

Beijing quickly pushed back against the narrative. The Chinese Foreign Ministry called the allegations "entirely groundless, speculative and intended to smear and malign China." In response to the news, Huang admitted he had been "unfaithful" to his wife. He apologized for the hurt caused to her and their children and pledged to cooperate fully with the board's inquiry.

The announcement drew mixed reactions from the political and business establishment. President Donald Trump described Huang as an "honourable guy," while tech figure Elon Musk offered his support. Rival chipmakers saw their stocks rise as money rotated out of Nvidia, though the broader US market opened higher after a turbulent week.

Victoria Fernandez, chief market strategist at Crossmark Global Investments, argued that the damage would likely be temporary. She noted that Nvidia remains central to the artificial intelligence trade. "Nvidia is the core of this AI trade, and without them, all these other pieces start to fall apart because the financing's not there," Fernandez said.

Huang holds approximately 3.5 percent of the company. Because Nvidia uses a single-class voting structure, he lacks the veto power that founders like Mark Zuckerberg or Elon Musk possess. Fernandez suggested the board might not remove him without clear evidence of wrongdoing but could begin grooming a successor. The company, which Huang co-founded in 1993, now ranks as the world's second most valuable firm.

The situation adds complexity to the US-China tech rivalry. Washington previously restricted sales of Nvidia's H200 semiconductor to prevent a strategic advantage for China. However, in January, the Trump administration allowed Nvidia to sell the chip to Chinese customers under specific conditions. Huang has historically opposed such export curbs, a stance that aligns with the company's recent commercial moves.