Nvidia shares plunge 8 per cent as board probes CEO Jensen Huang
The investigation follows reports that the chief executive was targeted by a foreign intelligence operation involving a Chinese businesswoman.
Nvidia shares fell by as much as 8 per cent in early trading on Monday in the United States after the company announced an internal investigation into whether chief executive Jensen Huang was the target of a foreign intelligence operation, according to reports by The Times of India, Business Today and The Indian Express.
The board of directors announced the inquiry on Sunday following media reports linking Huang to a Chinese businesswoman, Alice Huang, who was allegedly an asset of Chinese intelligence. The New York Times reported last month that Alice Huang, a former executive at Singapore-based Megaspeed, had developed a relationship with the Nvidia chief and allegedly passed information to Beijing.
Huang admitted to Nvidia employees that he had been unfaithful to his wife, Lori Huang. In a letter to employees, Huang wrote that leading Nvidia is the privilege of his life and that he had fallen short of his responsibility to be worthy of their trust.
An independent committee of directors, supported by external legal counsel, will oversee the investigation. The company stated that while the board has no reason to believe national security or Nvidia secrets were compromised, the inquiry will examine all available information. Huang will continue to serve as CEO and has pledged to cooperate with the review.
The company's shares hit a multi-month low during the session. While brokerage Bernstein said the controversy is unlikely to dent demand for Nvidia's products, it warned that the allegations could become a heavy distraction for the company.
