Nvidia shares plunged more than eight per cent as Wall Street opened on Monday after a spying scandal involving chief executive Jensen Huang threatened to derail the chipmaker’s recovery from last week’s brutal tech sell-off.

Shares in the AI giant fell 8.04 per cent to $171.64 in early trading, wiping billions from its market value as investors reacted to Nvidia’s announcement of an independent investigation into reports that Huang had been targeted by Chinese intelligence.

The decline follows a tumultuous week for technology stocks, which saw $2.5 trillion wiped from the Nasdaq on Thursday amid mounting fears over the sustainability of the AI investment boom.

Nvidia staged a partial recovery on Friday, with shares jumping more than seven per cent in early trading, but remained around 22 per cent below their October peak.

The latest controversy threatens to reverse those gains just nine days before the world’s most valuable chipmaker reports its quarterly earnings.

Nvidia boss faces spy investigation

Huang admitted over the weekend that he had been unfaithful to his wife, following reports that he had been involved with Alice Huang, a former executive at Singapore-based data centre company Megaspeed International.

US authorities reportedly identified Alice Huang, who is unrelated to the Nvidia boss, as a Chinese intelligence asset. The allegations have not been established as findings against Jensen Huang.

“I owe my family and all of you an apology,” Huang told employees. “My actions hurt her and our children. There is no excuse for what I did. I am deeply sorry.”

Nvidia’s board has appointed independent directors and outside lawyers to investigate the reports, although it said it had “no reason to believe” national security or confidential company information had been compromised.

The company also reiterated its confidence in Huang, who has become the public face of the AI boom and played a central role in Nvidia’s rise.

But analysts warned that the investigation could raise questions about Huang’s future at the company he co-founded in 1993.

“Huang now faces the prospect of being hauled in front of US lawmakers and grilled over his relationship, which is likely to put his position at severe risk.”

“Given his totemic status as the genius that has driven Nvidia to where it is now, his departure does cast a major shadow over the stock.”

Buying opportunity?

Despite the decline, some analysts argued that investors could use the sell-off to buy Nvidia shares at a discount.

Nigel Green, chief executive of financial advisory firm Devere Group, said the market was treating a personal scandal as a corporate crisis.

“A fall of this size is likely to knock somewhere between $200bn and $250bn off Nvidia’s value, yet nothing about this weekend’s news changes how many chips it sells or how badly the world needs them,” he said.

“Savvy investors can tell the difference between a reputational storm and a broken business.”

The scandal has renewed scrutiny of Nvidia’s relationship with China, where US export controls have sought to restrict access to advanced American chips.

Huang has previously criticised those restrictions, arguing they have encouraged Chinese companies to develop rival technology.

The fallout has already reached Asia, where Huang’s daughter Madison, an Nvidia executive, cancelled a planned visit to South Korea for an industry conference.

US President Donald Trump offered his support on Sunday, describing Huang as a “fine person”, while billionaire investor Bill Ackman said he hoped the controversy was “a simple affair, not a risk to our national security”

Nvidia’s decline contrasts with a broader recovery across Asian tech markets on Monday.

Shares in Taiwanese chipmaking giant TSMC jumped 6.5 per cent, while Samsung Electronics and SK Hynix rose 2.9 per cent and 4.7 per cent respectively.

Last week’s sell-off followed sweeping Democratic victories in the US midterm elections, which intensified concerns that growing political opposition to energy-intensive data centres could slow America’s AI infrastructure expansion.

The Nasdaq plunged more than 5.5 per cent on Thursday, while chipmakers AMD and Micron suffered double-digit losses.

Naeem Aslam, chief investment officer at Zaye Capital Markets, warned that Nvidia’s investigation introduced further uncertainty for semiconductor stocks and the wider AI industry, with European tech companies particularly exposed to renewed selling pressure on Wall Street.

The scandal has also renewed scrutiny of Nvidia’s relationship with China, where US export controls have sought to restrict access to advanced American chips.

Huang has previously criticised those restrictions, arguing they have encouraged Chinese companies to develop rival technology.