Nvidia’s Directors Hire a Former Prosecutor; Shares Slide Again

SANTA CLARA, Calif., Nov. 10 — Nvidia’sNvidia’s independent directors have hired a former federal prosecutor to run the inquiry their board opened on Sunday, which the board said was prompted by “recent reporting” that Jensen Huang, the chief executive, had been the target of a foreign intelligence effort. “The independent members of the NVIDIA Board have retained former acting U.S. Attorney of the Southern District of New York Joon H. Kim and his firm Wachtell, Lipton, Rosen & Katz to conduct a thorough and independent investigation as was announced on Sunday,” they said in a statement released at 2:07 p.m. Eastern on Tuesday. That is the whole statement.

It names no directors and sets no timetable. Mr. Kim joined Wachtell last month and was previously the chief U.S. prosecutor in Manhattan, CNBC reported, citing Law360. When it ordered the inquiry on Sunday, the board said it had “no reason to believe that either national security or NVIDIA secrets were compromised.”

The directors named counsel a week before Nvidia reports its fiscal third-quarter results, on Tuesday, Nov. 17; three House chairmen have asked Mr. Huang to brief them behind closed doors the next day. Investors worry “that the investigation and scandal could result in the co-founder and CEO being forced out,” CNBC reported. The board said on Sunday that it “has confidence in Jensen and his leadership team,” and an Nvidia representative has said Mr. Huang is committed to continuing as chief executive without interruption, according to CNBC. In a message to employees on Sunday, Mr. Huang wrote that he was unfaithful to his wife; he named no one, and of the national security concerns he wrote, “I support the investigation and will cooperate fully.”

Nvidia’s shares fell 5.47 percent on Tuesday, to $168.89, after a 4.27 percent fall on Monday, leaving them 9.51 percent below Friday’s close.NVDANasdaq173.73▲4.84+2.9%Nvidia · Wednesday’s session The two-day slide pulled the company’s market value “down to around $4.07 trillion, its lowest since late March,” CNBC reported.Two SessionsNvidia closed at $186.64 on Friday, Nov. 6, and at $178.67 on Monday, by Nasdaq’s record. Tuesday’s $168.89 is $17.75 lower than Friday’s close.

The rest of the chip trade barely noticed: the PHLX Semiconductor index slipped 0.35 percent, while Broadcom rose 3.91 percent, TSMC’s American shares 2.02 percent and AMD 1.30 percent.AVGONasdaq345.22▲13.24+4.0%Broadcom · Wednesday’s session It was the second day running that chips moved without Nvidia. The S&P 500 fell 0.38 percent after consumer prices rose 0.4 percent in October, “more than expected,” CNBC reported.

Before Wednesday’s opening bell, Nvidia’s shares were trading at $176.19, up 4.32 percent, at 5:18 a.m. Eastern, by CNBC’s quote service. By 5:17 a.m. Nvidia had filed no Form 8-K about the inquiry with the Securities and Exchange Commission; its latest filing was still a Form 4 of Nov. 6.

Washington

The House chairmen, Brian Mast of Foreign Affairs, John Moolenaar of the Select Committee on China and Rick Crawford of the Intelligence Committee, asked Mr. Huang for the Nov. 18 briefing last week. “Mr. Huang must accept the invitation or provide alternative availability by November 11, 2026,” the China committee said. That is today. By 5:32 a.m. Eastern, Daily Cortex had found no public reply from Mr. Huang or Nvidia in Nvidia’s newsroom or the China committee’s releases.

In the Senate, Jim Banks, an Indiana Republican, and Elizabeth Warren, a Massachusetts Democrat, said in a joint statement on Monday that Mr. Huang’s “confirmation of a relationship with a suspected spy for China’s intelligence service makes these national security concerns even more urgent.” “It is time for Congress to take decisive action to pass key bills like the AI Overwatch Act in the NDAA that will cut off the various pathways through which China accesses advanced chips,” they said.The AI Overwatch ActIntroduced by Mr. Banks and Ms. Warren in April, it would write into law President Trump’s restrictions on exports of the most advanced AI chips to foreign adversaries. It is in the Senate’s version of the defense bill for fiscal 2027, the senators’ office says.

It is time for Congress to take decisive action to pass key bills like the AI Overwatch Act in the NDAA that will cut off the various pathways through which China accesses advanced chips.

Hakeem Jeffries, the House Democratic leader, “strongly supports” the chip restrictions in the Senate’s bill, The Hill reported. “We’re going to work hard to make sure that those provisions make it into the final version,” he told reporters at the Capitol on Monday, as quoted by The Hill.

Asia

Asia’s markets looked past Nvidia on Wednesday: Taiwan’s Taiex closed up 3.62 percent, at 44,257.15, and Seoul’s Kospi 2.6 percent, at 5,375.36. TSMC rose 4.81 percent, to NT$2,395, after it announced a higher quarterly dividend and strong October sales, dealers said, according to CNA. “TSMC drove the Taiex significantly higher as a hike in cash dividend payout and strong October sales data prompted investors to buy,” said Alex Huang, an analyst at Mega International Investment Services, as quoted by CNA.TSMC’s BoardOn Tuesday TSMC’s board also approved buying up to US$500 million of Anthropic’s shares at its IPO price, and up to US$500 million of OpenAI’s preferred stock. The lead story has Anthropic’s terms.

In Seoul, foreign investors bought a net 655.26 billion won of shares, Yonhap reported. Samsung Electronics rose 3.57 percent and SK hynix 5.36 percent.

Nebius reports before the market opens on Thursday, and Cisco after the close. Nvidia’s own call is at 5 p.m. Eastern on Nov. 17; the chairmen’s briefing would follow the next day.