Nvidia shares tumble after spy probe announced

Well, for more on this, France 24's business editor, Yuka Royer, joins me now on set. Hi, Yuka. So why don't you start with a roundup of how the financial markets have been reacting to this news? Of course, Erin, let's start by a look at NVIDIA's stock. It's been battered on the stock market, of course, after dropping as much as 8% in pre-market at the opening bell. The share is currently down by 3.66%, meaning that the decline... It's still down from Friday's close, but it's performing somewhat better now. Now, NVIDIA's market value is around four and a half. trillion dollars heading into the session. It means that within the first few minutes alone of trading, its share value, its market value declined by about 300 billion dollars. Now, Nvidia has a significant weight on the Nasdaq, but the tech heavy index itself is actually rising this Monday. It's extending its recovery from a sharp sell-off last Thursday, which sent it into correction territory, meaning it was down by more than 10% from its most recent peak That rout was caused by concern over a new Democrat-controlled U.S. Congress would tighten control over AI data centers and the market sell-off spread worldwide, with Tokyo's Nikkei, for instance, falling 6 percent to notch the third worst one-day loss in history on Friday. Now, back to the markets today. European markets advanced comfortably this Monday with Germany's DAX rising as much as 1.6%. So let's take a look at the scandal itself, Yuka. What is it exactly that NVIDIA's board is investigating now? Well, the stunning announcement came after CEO Jensen Huang acknowledged that he had had a romantic affair with a woman whom U.S. intelligence officials believe was a spy for China. Now, Huang apologized for having an extramarital affair with the tech executive who goes by the name of Alice Huang. No relation there. The New York Times earlier reported that she had been recruited by China's top spy agency to try and gather information about NVIDIA's cutting edge technology Now, she was a top executive at a data center, data firm in Singapore, which had been suspected of helping divert NVIDIA's chips to China, a claim the company later said was debunked. Now, NVIDIA's chips power many of the data centers and computing systems to train and run AI models. And for national security reasons, the U.S. government has long... restricted exports of those chips to China. Right now, it's only NVIDIA's slower H200 AI chips that are allowed to be shipped out to the Asian giant. Now, Huang says he's fully cooperating with the independent investigation, and analysts believe that chances of him being fired as CEO are small, though the company may face tighter regulatory scrutiny going forward. And finally, Yuka, I mean, NVIDIA obviously is not just any company. It is the standard bearer of the AI boom. What will that mean then? Yeah, we're a standard bearer of the AI boom. It's also one of the fastest growing companies in the world. At the chip makers most recent quarterly results. out in August showed net profit rising to a new record of nearly $60 billion, with revenue almost hitting the trillion-dollar mark. Both more than doubled from the same period a year before. Now, full-year profit increased almost 20-fold in just three years, from around $10 billion in 2023 to a whopping $193 billion. Yuka Royer from our business desk, thank you very much.