Nvidia CEO Jensen Huang has admitted to an affair with an alleged Chinese spy who targetted him in a foreign intel operation, saying there was "no excuse" for his actions. He also apologised to his wife Lori Huang and children as the AI chip giant launched an independent probe into allegations that he was in a relationship with a Chinese businesswoman.

"I was unfaithful to my wife. My actions hurt her and her children. There is no excuse for what I did. I am deeply sorry," the 63-year-old said in an email to employees.

The developments follow allegations that a Chinese businesswoman who developed a close relationship with Huang was secretly gathering information for Beijing. The alleged spy, Alice Huang, who is not related to Jensen Huang despite sharing his surname, has been identified as Huang Le. She was associated with Singapore-based data centre company Megaspeed.

Jensen Huang, who co-founded Nvidia in 1993 and has led the company for more than three decades, also acknowledged falling short of his responsibilities to the company's employees, board and shareholders.

"My responsibility is to serve you and be worthy of your trust. I have fallen short of that responsibility. I am fully committed to Nvidia and will work to earn back your confidence," he said, adding that he would take full responsibility for his actions.

The personal admission came alongside growing national security concerns surrounding the world's most valuable chipmaker. Nvidia's board of directors said it had initiated an independent inquiry following reports that its founder and CEO had been the target of a foreign intelligence effort.

The investigation will be overseen by a committee of independent directors and assisted by external legal counsel. Huang has backed the inquiry and pledged to cooperate fully.

"While the Board has no reason to believe that either national security or Nvidia secrets were compromised, the Board's inquiry will examine all available information," the company said in a statement, adding that protecting US national and economic security remained a priority.

WHO IS ALICE HUANG AND WHAT ARE THE ESPIONAGE CLAIMS?

The New York Times reported in October that US authorities had investigated Alice Huang over suspected links to Chinese intelligence. US intelligence officials reportedly believed she was gathering information for Beijing.

According to reports, Alice Huang was photographed sitting next to Jensen Huang at a party in Taipei in June 2024. Her association with Megaspeed subsequently attracted attention because of the company's substantial purchases of Nvidia AI chips.

Megaspeed purchased more than USD 4.8 billion worth of Nvidia chips over two years, raising questions about the destination of the processors amid US restrictions on exports to China.

The New York Times reported that US President Donald Trump had been briefed about the intelligence allegations roughly a year before they became public. However, Jensen Huang was never given a formal defensive briefing warning him that he could be a target of a foreign intelligence operation

Nvidia had previously defended its dealings with Megaspeed, with Huang describing the business relationship as normal. The company said it had examined Megaspeed's deployments of Nvidia GPUs and checked that its chips had not been illegally diverted to China.

Three Republican committee chairmen -- Brian Mast, John Moolenaar and Rick Crawford -- requested a closed-door briefing with Huang in a letter dated November 4.

The lawmakers said Congress needed to establish whether US national security had been put at risk and examine China's potential access to sensitive American technology and information. They sought answers about the allegations and Nvidia's safeguards against foreign intelligence operations, requesting that Huang brief them on November 18.

Nvidia has previously maintained that its CEO interacts with thousands of customer executives every year and that its cloud customers in Asia receive only ordinary business information, not sensitive trade secrets or information related to US national security.

US export controls introduced since 2022 have sought to restrict China's access to advanced Nvidia chips and the equipment required to manufacture them.

TRUMP BACKS NVIDIA CHIEF

Trump has expressed support for Jensen Huang despite the allegations, saying he had not spoken to the Nvidia chief since news of the investigation emerged.

"I just know he's a fine person, but you never know what's going on," Trump told reporters, while praising Huang for having "done an amazing job for our country".

Asked whether he regretted not acting on the intelligence when he was briefed last year, Trump said, "No, I don't think so. I think he's an honourable guy."

China, meanwhile, has previously rejected allegations of an espionage operation targeting the Nvidia chief, dismissing the claims as "groundless speculation".

INVESTOR CONCERNS ADD TO PRESSURE

The investigation comes at a sensitive time for Nvidia, which has become a central player in the global AI boom. Its chips power AI infrastructure used by leading technology companies and model developers, including OpenAI and Meta.

Jensen Huang's decision to pivot Nvidia's graphics processing technology, originally developed largely for gaming, towards AI computing helped transform the company into a semiconductor powerhouse. Having co-founded the firm in 1993, he has steered it through multiple challenges and played a pivotal role in its rise to a multi-trillion-dollar valuation.

However, the company is now facing investor concerns over the sustainability of AI spending, with its estimated market value of USD 4.5 trillion coming under pressure amid a broader technology sell-off. Its shares have also given up their gains for the year.

The latest controversy could add another layer of uncertainty, particularly because of Huang's central role in Nvidia's global strategy and business.

Dan Ives, partner and senior managing director at Yorkville Ives & Co, warned that the investigation could create additional risks for investors, given how closely Nvidia's fortunes are linked to its chief executive.

"There is clearly a risk that Jensen could be removed as CEO depending on the Board investigation and this will add risk to the stock as he is so important to the Nvidia story and strategy globally," Ives said.

He described the developments as a major setback for Huang, predicting that the allegations could trigger congressional inquiries and greater scrutiny of Nvidia's chip sales to China.

Source: India Today