PILING PRESSURE ON NVIDIA
The investigation adds to pressure on Nvidia at a time investors are already pulling back from uncertainty over the sustainability of the AI market, in which the company is a leader. The US$4.5 trillion chipmaker’s shares have given up all their gains this year amid a broader tech market rout triggered by worries over AI sustainability.
“There is clearly 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,” said Dan Ives, partner and senior managing director at Yorkville Ives & Co.
“This is a black eye moment for Jensen and will spark multiple congressional inquiries at a minimum and will create an overhang on the stock,” Ives said, adding that the news would also increase major scrutiny about selling chips to China.
Huang admitted to having been unfaithful to his wife, saying, “My actions hurt her and our children. There is no excuse for what I did. I am deeply sorry.”
Addressing his colleagues, board, partners and shareholders, Huang said: “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.”
Top Republican lawmakers in the US House of Representatives have already called on Huang to brief Congress this month about the New York Times report.
The report raises “significant national security concerns regarding (China’s) access to sensitive US technology and information”, the lawmakers said in a letter dated November 4.
“It is vital that Congress determines the extent to which US national security has been placed at risk,” they added.
US export controls since 2022 have sought to restrict China’s access to advanced Nvidia chips and the equipment needed to make them.
Huang, who co-founded Nvidia in 1993, said that he was “committed to protecting NVIDIA and supporting America’s national security”.
Nvidia had earlier said that Huang talks with “thousands of customer executives every year”, and that cloud customers in Asia receive ordinary business information, not sensitive Nvidia trade secrets or anything tied to US national security.
Source: www.channelnewsasia.com
