(Al Jazeera Media Network) Nvidia stock tumbled in early trading after the company launched an internal investigation into whether CEO Jensen Huang had been targeted by a Chinese intelligence operation.
News of the probe into the California-based semiconductor giant sent its stock tumbling over 4 percent as United States financial markets opened for the week, while tech stocks and wider indexes rose.
The probe comes amid reports that Huang developed a close personal relationship with a Chinese business executive of a Nvidia partner company who allegedly passed information to Beijing. In a letter to employees, Huang admitted to not being faithful to his wife, but did not elaborate on the details of the relationship.
“NVIDIA’s Board of Directors has initiated an independent investigation. I support the investigation and will cooperate fully,” Huang said in the letter.
On Sunday, the firm announced the investigation. “The Board prioritizes U.S. national and economic security, which is paramount to the interests of NVIDIA and its shareholders,” the company said in a statement.
“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 investigation puts Huang’s future in the spotlight at a company with a market capitalisation of $4.5 trillion. Huang is Nvidia’s fifth-largest shareholder, owning 3.6 percent of the company, according to LSEG data. However, Nvidia’s co-founder does not have majority voting control, unlike executives at other companies in the sector, such as Meta and SpaceX.
The tech-heavy Nasdaq was not affected by Nvidia’s downturn on Monday, with the index up 2.7 percent in early trading.
