The controversy surrounding Nvidia CEO Jensen Huang’s reported admission of an extramarital affair with a Chinese businesswoman accused by US agencies of being a Chinese spy has escalated into a political dispute, even as Huang reportedly returns to his usual executive duties.
Meanwhile, Nvidia shares NVDA rebounded on Wednesday, gaining about 4% in premarket trading after two consecutive sessions of losses.
The recovery was partly supported by CoreWeave’s earnings.
The AI cloud infrastructure company raised its annual revenue forecast and said it would avoid tapping unsecured debt markets amid a recent surge in borrowing costs.
CoreWeave’s own stock was rising around 16% during premarket trading on Wednesday.
Schumer turns Nvidia controversy into political confrontation
Senator Charles Schumer, a Democrat from New York, criticised Trump on Tuesday following reports that the president had been briefed more than a year ago about Huang’s alleged extramarital relationship with Alice Huang.
“The press reports that Trump was briefed more than a year ago that Nvidia’s CEO was having an affair with a suspected Chinese spy, and Trump didn’t do anything – anything – about it,” Schumer said on the Senate floor.
“Can you believe that?” he added.
The New York Times had reported that Trump was informed about the allegations but did not act on them.
Trump suggested on Monday that he had only recently learnt of the claims.
He also said he “really” believed Jensen Huang’s assertion that he had no knowledge that Alice Huang was a spy.
“One of our most important companies that is involved in national security, and the CEO might be having an affair with a Chinese spy, and Trump did nothing about it,” Schumer said.
“What a dereliction of duty. He’s supposed to protect America, not China, not his friends,” he added. “Trump has been busy trying to defend Jensen Huang when he ought to be defending our national security. It’s that simple, it’s obvious.”
Schumer also accused the administration of showing reluctance to confront China over artificial intelligence technology.
“Despite talking a big game, Trump continues to show a troubling resistance to confront China on AI and to protect American national security,” he said.
“I’ve been saying it for years: our cutting-edge AI chips are too valuable to fall into the hands of potential adversaries.”
Democrats seek tighter controls on AI chip exports
The Senate minority leader urged Republicans to support three pieces of legislation — the AI Overwatch Act, the Match Act and the Chip Security Act — which he said would restrict China’s access to advanced American technology.
Schumer also called for greater scrutiny of Nvidia’s influence on government decisions and the easing of export restrictions.
“We also need answers on Nvidia’s influence campaign and how [it] affected the Trump administration’s national security decisions, including the loosening – the loosening – of key export controls,” he said.
“We need a full accounting for Trump’s failure to address foreign espionage in the American tech industry.”
US ambassador to China David Perdue also emphasised the national security implications of the controversy.
“The situation with Nvidia is another reminder that we have to stay diligent,” Perdue told Bloomberg Television.
“National security is part of this economic conversation because economic security is national security. And so, what we’re doing with China is bumpy right now,” he said.
Huang returns to work as Nvidia launches investigation
While the allegations have triggered political scrutiny, Huang has reportedly returned to his regular executive routine at Nvidia’s headquarters in Santa Clara, California.
CNBC reported that Huang attended his usual morning meeting with senior executives on Monday, where he addressed his infidelity and apologised to employees.
He did not take questions and quickly moved on to the day’s business agenda, according to people familiar with the meeting who were not authorised to speak publicly, CNBC said.
Huang was also in the office on Tuesday, holding meetings ahead of Nvidia’s quarterly earnings report next week.
People inside the company said the CEO was trying to project “business as usual” as the controversy continued to unfold.
The company said on Sunday that its board was investigating whether Huang had been the target of a foreign intelligence effort following media reports about his relationship and claims that Alice Huang had passed information to Beijing.
Nvidia hires prominent US law firm for investigation
Nvidia has hired prominent US law firm Wachtell, Lipton, Rosen & Katz to conduct a “thorough and independent” investigation into the relationship.
The New York-based firm, which is among the most prestigious corporate law practices in the country, will have the inquiry led by partner Joon Kim.
A former government prosecutor in New York, Kim specialises in internal investigations, white-collar criminal and regulatory defence, and crisis management.
Wachtell is also known for its role in corporate takeover defence.
Its founding partner Martin Lipton developed the poison pill strategy in the 1980s, a mechanism that makes hostile takeovers more difficult by allowing existing shareholders to buy additional shares at a discount if an investor crosses a specified ownership threshold.
Nvidia shares rebound; attract dip buyers despite the controversy
The controversy has not prevented Nvidia shares from recovering some recent losses.
The stock rose about 4% in premarket trading on Wednesday after falling for two consecutive sessions.
The rebound was supported partly by results from CoreWeave, which raised its annual revenue forecast and said it would not tap unsecured debt markets following a recent increase in borrowing costs.
The AI cloud infrastructure company said cash flow from existing contracts would be sufficient to cover both current and future debt repayments, helping ease some concerns about financing pressures across the AI infrastructure sector.
British investors have also stepped in to buy Nvidia shares following the sharp decline.
Over the past two trading sessions, Nvidia has lost around $430 billion in market value amid the controversy and broader concerns about the cost of the artificial intelligence infrastructure boom.
However, several investment platforms and ISA providers have reported increased buying activity as investors look beyond the headlines and focus on the company’s long-term prospects, The Independent reported.
Nvidia was the most purchased stock on AJ Bell and Dodl’s platforms between November 5 and 9, ahead of companies such as SpaceX and Micron.
The buying activity included transactions through pensions, individual savings accounts (ISAs) and general investment accounts.
Freetrade also reported that Monday marked its highest-ever single-day value of Nvidia purchases.
Buying activity was around 53% higher than the platform’s previous record, set in October 2025.
“Users clocked up their biggest ever day of Nvidia buys, surging well beyond the previous record by total value, as they shrugged off reports of an alleged Chinese honeytrap targeting CEO Jensen Huang,” said Freetrade analyst Duncan Ferris.
“Fundamentally, their assessment may be that, while the evolving controversy surrounding Huang could compromise his leadership, the fallout will have little impact on Nvidia’s dominant position and prospective chip demand. After all, the AI buildout is bigger than one man.”
ARK Invest adds to Nvidia holdings
Cathie Wood’s ARK Invest also bought 90,443 Nvidia shares on November 9, the first trading session after the company’s board announced an independent investigation into Huang.
According to ARK’s daily trade disclosures, the purchase was spread across five actively managed exchange-traded funds.
The largest allocation, comprising 51,097 shares, went to the ARK Innovation ETF.
The shares were worth an estimated $16.2 million at the market close.
While the purchase added to ARK’s Nvidia exposure, its relatively modest size compared with the firm’s overall assets suggests a measured increase rather than a major new investment commitment.
Investors will now be watching Nvidia’s upcoming earnings report as well as developments in the board’s investigation.
The political fallout has added a new dimension to scrutiny of the chipmaker, whose processors are central to US ambitions in artificial intelligence and its competition with China.
AI disclosure: AI tools assisted with research and drafting of this piece. An Invezz editor reviewed the facts, sources and wording before publication. Any opinions or analysis are Invezz’s, not those of an automated system.
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