Nvidia’s value tumbles by $430bn since spy allegations, as major US law firm hired to investigate claims – business live
Nvidia has retained a major US law firm to investigate claims about CEO Jensen Huang's relationship with a suspected Chinese spy, as the company's value plunges by $430bn.
The crisis gripping Nvidia is gathering pace, with around $430bn wiped off the value of the world's most valuable company since it was hit by a spying scandal. Overnight, Nvidia announced it has hired a former top federal prosecutor to help probe chief executive Jensen Huang's relationship with a suspected Chinese spy.
The company's board have retained Joon H. Kim, the former acting U.S. Attorney of the Southern District of New York, and his firm Wachtell, Lipton, Rosen & Katz to conduct 'a thorough and independent investigation'.
Spy allegations fallout
Wachtell is a heavyweight corporate law firm. In 2022 it was hired by Twitter to force Elon Musk to complete his $44bn takeover, and has a track record of advising major companies on issues such as mergers and corporate governance.
It will now look into the circumstances of Huang's affair – thought to be with Alice Huang, the head of Nvidia customer Megaspeed, who US officials believe is a Chinese spy. Although Beijing has denied allegations that it operated an espionage operation targeting Jensen Huang, Nvidia's value has been buffeted this week.
Nvidia's 5.47% decline to $168.89, extending its losses for a second consecutive session, has transformed an executive controversy into a test of institutional confidence. Approximately $430 billion in market value has reportedly disappeared across the two sessions as investors confront allegations involving CEO Jensen Huang's personal relationship with a businesswoman suspected of connections to Chinese intelligence.
Market impact
Yesterday, Nvidia's shares fell by almost 5.5%, adding to the 4.27% drop on Monday. This has pulled the company's value down to $4.07tn, from $4.50tn before the story broke last weekend.
The situation with Nvidia is another reminder that we have to stay diligent. 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.
The allegations over Nvidia are testing relations between Washington DC and Beijing, according to the top US diplomat in China. Ambassador David Perdue told Bloomberg Television that the situation is 'another reminder that we have to stay diligent'.
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