U.S. Chip Giant Reels from China Spy Scandal

https://www.nbcnews.com/business/business-news/nvidia-shares-drop-hours-reports-meeting-ceo-jensen-huangs-future-rcna608906 Nvidia CEO Jensen Huang’s future hangs in the balance as U.S. chip giant reels from China spy scandal The company’s shares plunged in pre-market trading, dragging down Nasdaq 100 and S&P 500 futures.Nov. 11, 2026, 5:51 PM CST / Updated Nov. 12, 2026, 6:44 AM CST By Steve Kopack, Monica Alba and Rob Wile Shares of Nvidia sank more than 8% in premarket trading Thursday morning as the fate of Jensen Huang, one of the most important executives in the global AI boom, hung in the balance. Nvidia’s board met Wednesday night to address Huang’s future at the company, two sources familiar with the matter told NBC News, as the American chipmaking giant reeled from scandals surrounding its founder and leader. The meeting of the company’s board followed a new report in The New York Times that said Huang had a relationship with an executive at Nvidia who reported to him. The Times cited five people who worked at Nvidia. The report followed news of his affair with a businesswoman who U.S. intelligence agencies determined was a Chinese spy, according to a source. NBC News has not confirmed the Times’ report and Nvidia has not responded to multiple requests for comment. In early morning trading, Nvidia shares also dragged down Nasdaq 100 and S&P 500 futures. If Nvidia’s stock drop carries over into the regular trading session at 9:30 a.m. ET, it would be the third straight days of heavy selling, wiping out more than $300 billion in value since Monday morning.In an email to Nvidia’s workforce Sunday, Huang admitted, “I was unfaithful to my wife.” He did not specify any additional details. The White House was aware of the Nvidia board meeting Wednesday, one of the sources said. Huang is close to President Donald Trump, even recently taking a phone call from the president on speakerphone during a conference. On Sunday, before the latest developments, Trump was asked by reporters if Huang should remain CEO. “I think so. Oh, yeah, sure.” Trump continued to voice support for Huang on Monday. “I just think he’s a very honorable man,” Trump said. “I think he’s a very honorable guy, and I feel very confident that he’ll be in good shape.” Thursday’s Nvidia selloff added pressure to a company whose shares have been tumbling. Nvidia shares have declined by more than $1.5 trillion in value since hitting a record high in early October. China has dismissed the allegations that Alice Huang, the businesswoman who had an affair with Huang, spied for the country, calling them “purely unsubstantiated and directed at smearing China.” The two Huangs are not related. “The U.S. side should stop fabricating so-called espionage narratives as a pretext for implementing technological blockades,” Foreign Ministry spokesperson Mao Ning told reporters Thursday. Jeffrey Sonnenfeld, an expert on corporate governance and executive leadership and senior associate dean for leadership studies at the Yale School of Management, hailed Huang’s contributions to the industry but said the board should move to oust him. Huang “has lost his legitimacy to lead internally in the eyes of the company, and he’s lost his external credibility in the eyes of key constituents, including customers,” he told NBC News. Huang is among the most important people underpinning the AI boom and the trillions of dollars of investments tech giants are pouring into it around the globe. Nvidia chips are the cornerstone of developing artificial intelligence, powering all of the top developers, from OpenAI to Anthropic. Huang founded the company and has been its leader since 1993, taking the graphics processing chip company from nothing to a valuation of more than $4 trillion. Nvidia is currently the world’s second largest public company. On Monday, longtime chip sector analyst Stacy Rasgon wrote that removing Huang from the company could pose massive problems for the trillion-dollar firm. “NVIDIA is not an ordinary company and Jensen is not an ordinary CEO; he IS NVIDIA,” Rasgon wrote. “The primary beneficiary of Jensen’s removal as NVIDIA’s CEO would clearly be China.” Rasgon said the revelations also had wider implications. “It brings the stewardship of one of America’s most important companies, and the architect of the US AI trajectory, under debate,” he wrote in a note. On Thursday morning, Rasgon and a wave of other tech analysts, downgraded the stock, which had been a high flyer until recent days. “It feels impossible to us for the board keep him in the role,” he wrote in a note. “If Jensen were forced out, it would mark the end of an era,” Citi analysts said. “Under his leadership, Nvidia became the dominant force in AI infrastructure, the primary beneficiary of the global AI spending cycle, and one of the world’s most valuable companies.” On Wednesday night, as the Nvidia board met, Sens. Elizabeth Warren, D-Mass., and Chris Coons, D-Del., announced they had written to Commerce Secretary Howard Lutnick with a request to preserve records as the dramatic events engulfed the company. “We write to request that the Department of Commerce, the Department of State, and the White House preserve all documents, communications, records, and other materials regarding the export of NVIDIA’s advanced AI chips to China or to entities that may divert such chips to China,” they said in a letter. They also requested that “all records and materials specifically related to this reported intelligence operation” regarding Huang and the Chinese business executive also be preserved. In the coming months, Democrats will hold control of both the House and the Senate and, as a result, will have subpoena power. Warren and Coons added in their letter: “This incident raises significant concerns about the federal government’s ability to effectively enforce our export controls and protect our national security.” Lawmakers have become alarmed by the events surrounding Nvidia and Huang in recent days because Nvidia chips are effectively how the United States has, so far, led the AI revolution. Chinese President Xi Jinping recently set a deadline of 2030 for his country’s companies to catch up with or surpass the capabilities of American AI systems. The request from the lawmakers also comes just days before Trump embarks on a visit to Asia for meetings of both the Asia-Pacific Economic Cooperation and the Association of Southeast Asian Nations. During the trip, Trump is widely expected to meet with Xi for the third time this year. At a briefing with reporters this week at the White House, Trump was asked whether Huang could accompany him on the trip, as he did earlier this year on a trip to Beijing. “I don’t know, but I’d certainly take him,” Trump said.