The disclosure of the relationship with Powell adds significant pressure on Huang, who admitted on Sunday to a separate affair with Alice Huang, an executive at Megaspeed, a Singapore-based data center firm. US intelligence officials believe Alice Huang, a Chinese citizen who is not related to the Nvidia CEO, was recruited by China’s Ministry of State Security. The New York Times reported that the pair were caught on camera being affectionate at an Nvidia conference in San Jose, California, which initially prompted an internal investigation. While the board publicly backed Huang on Sunday, the subsequent revelation of the affair with Powell has accelerated discussions about his removal.
The controversy has had an immediate impact on the market, with Nvidia shares falling more than 8% in after-hours trading. The company’s stock price had previously positioned it as the second most valuable company in the world, behind only Apple. The financial stakes are high, as Megaspeed purchased $4.8 billion worth of Nvidia chips over the past two years. The alleged espionage links and governance failures have raised concerns among investors and policymakers regarding the integrity of Nvidia’s supply chain and its adherence to US export control regulations designed to prevent advanced semiconductor technology from reaching China.
President Donald Trump confirmed on Monday that the FBI is investigating the allegations against Huang. In response to the growing scrutiny, the Nvidia board launched its own probe on Tuesday, hiring a former federal prosecutor to lead the inquiry. Senior members of both the Republican and Democratic parties have called for congressional investigations, citing Huang’s influential role in shaping US AI policy and export controls. Although the board initially pledged support for Huang, the convergence of personal misconduct allegations and national security concerns has made his retention increasingly untenable.
Nvidia remains a critical player in the global AI infrastructure market, with its chips powering data centers that train large language models. The company’s leadership transition, if it proceeds as reported, will occur during a period of intense geopolitical competition over semiconductor technology. The outcome of the FBI investigation and the internal board probe will determine not only Huang’s future but also the stability of Nvidia’s operations and its standing with US regulatory bodies.
