Nvidia shares drop after CEO Jensen Huang under investigation

...of Santa Clara-based NVIDIA tumbled at opening bell this morning. It comes a day after the company's CEO acknowledged reports that state there was a gathering information, a corporate espionage here, centered on China. You're looking at the stock price now. It's down close to 5%, $177 a share right now. Jensen Huang, his company is central to the artificial intelligence race that chips his company produces, power many of the data centers and computing systems used to train and run AI, And that is... There's a reason why this news is sending a ripple effect through the markets and international affairs this morning. KTVU's Ali Rasmus live with an update on the follow-up. Ali? Well, first, let's start with the controversy. In a letter to employees this weekend, NVIDIA CEO Jensen Huang admitted to having an affair with a Chinese business executive. He apologized in that letter to the company, his wife and family, his two adult kids and his son-in-law work at NVIDIA. But the problem and controversy here extends far beyond just an extramarital affair. Chipmaker NVIDIA, as you mentioned, is one of the richest and most powerful companies in the world. Its stock is down more than 6 percent this morning. The company is so Many other tech companies are tied to its fortunes, and that could affect the market today. The market always looking for is certainty. And now that we have this investigation, this brings a lot of uncertainty. And the market hates uncertainty. They want things to be stable. They want to know what's going to happen next. And because of this, it's going to bring uncertainty to Nvidia stock. Now, the woman at the center of this controversy is Alice Wong. She's seen here in that pink dress on the right of the screen. In this video from the Associated Press, walking into an event with NVIDIA CEO Jensen Huang. Alice Wang is a Chinese citizen and a former executive at a data center company called Megaspeed. Megaspeed is one of NVIDIA's top customers, buying about $5 billion worth of its high-powered and highly coveted chips, technology that some U.S. intelligence officials say China ultimately should not have because of national security concerns. Last year, US intelligence officials identified Alice Wang as a possible Chinese intelligence asset or spy. This is very, very concerning because of who he was having an affair with, the company she works for had been flagged as possibly working with Chinese intelligence, with the With the Chinese government and one has to assume. That she, you know, she probably was, this was part of a Chinese intelligence gathering operation, whether it was for compromising him, influencing his decisions. NVIDIA is light years ahead in the development of the chips. There's certain ways, certain designs, certain programs, internal tools that nobody knows about it, except, you know, the people who work at NVIDIA. And China would like to know about that. That's going to help them accelerate their development, understand what is next so they can gain advantage in the United States and stop relying on NVIDIA chips. Now, this morning, Beijing is denying Alice Wang was a spy or connected to their government in any way. Meanwhile, at NVIDIA, a company spokesperson says they will be launching an internal investigation into the matter, but that Jensen Wang will remain CEO during that investigation. Now, Wang is a close ally of President Trump. In December of last year, NVIDIA got permission from the Trump administration to sell some of its chips to China. Now, Secretary of State Marco Rubio informed the president of this affair and its likely connection to Chinese espionage. several months ago and no action was taken. Now, when it comes to NVIDIA stock and other AI companies, we'll continue to watch and see what happens at the markets in the coming hours. But meanwhile, congressional leaders have requested that NVIDIA CEO Jensen Huang come speak with them directly on November 18th. That is a day after the company is expected to deliver its earnings report. Back to you. All right. Thank you, Ali.