Nvidia: a Board Probe, an Investor Lawsuit, and a Stock More Than 25 Percent Below Its Peak
The world's most searched chipmaker spent Monday falling 4.3 percent as its board opened an inquiry into allegations its CEO was targeted by a foreign espionage operation - allegations the company says it has no reason to believe compromised its secrets.
Nvidia was the most searched name in American business on Tuesday morning - 1,000,000-plus searches on the 48-hour Google Trends list read by this desk - and the reason was not a product. The chipmaker's board has formed a committee of independent directors to investigate allegations that CEO Jensen Huang may have been targeted in a foreign espionage operation, after Huang disclosed an affair and apologised to employees, according to The Hindu BusinessLine's November 10 morning report. Huang is cooperating fully with the investigation, the report said.
Finimize's November 10 brief, read in full by this desk, fills in the allegation as reported - and it is reported here as allegation, not fact. The woman, Alice Huang (no relation given), is a former executive at Megaspeed, a Singapore-based neocloud that became one of Nvidia's biggest customers in Southeast Asia; Megaspeed has been under investigation over claims it smuggled chips into China, which it denies. US intelligence officials say Alice Huang was working for China, Finimize reported, raising questions about whether she influenced the CEO, who has publicly pushed for Nvidia to sell chips to China. A daily news summary read this run, citing Sky News, TechCrunch, CNBC and DW, reported that shareholders have filed a lawsuit against the company and Huang and that Nvidia's board says it has no reason to believe secrets were compromised; nobody has said what, if anything, was actually passed to Beijing.
The market has already voted its worry. Nvidia shares fell 4.27 percent on Monday to $178.67, wiping roughly $190 billion off the company's market value, according to the market file read this run, and Finimize put the stock more than 25 percent below its early-October peak. The Texas stake in the story is the buildout itself: Nvidia's advanced chips are the essential hardware of the AI data-center boom that North Texas is permitting at a record pace - two $72.6 million data-center shell permits sit near the top of this month's Dallas-Fort Worth permit list, filed as a separate story in this cycle - and a sustained slide in the chipmaker at the center of that boom is a story every Metroplex construction lender and power planner is reading this morning.
