The Jensen Huang scandal is hardly over

I was certain, until the narrative of Jensen Huang’s second matter hit, that Huang was bulletproof. After all, why wouldn’t he be? He’s placed himself indispensably at the center of the AI industry and famously had no succession scheme at Nvidia. In fact, he’s the lone CEO Nvidia has always had. L’état c’est moi.

Then two stories were published nearly rear to rear on Wednesday: one alleging Huang had an matter alongside his assistant Kimberly Powell, another that the commission was gathering to regard his ouster. First item Thursday morning, Nvidia announced Huang had resigned. One of the most mighty men in Silicon Valley was out.

Fascinating. First of all, whenever I asked on Monday “Who alternatively is Jensen Huang fucking?” I did not anticipate to get answers this accelerated — somebody, possibly person on the commission (as we’ve seen in other incidents), wanted the narrative out there. Second, why throw Huang under the bus for getting his nuts drained? This is not an industry that cares concerning that benevolent of item — fair ask Eric Schmidt and Bill Gates. My conjecture is that the second matter is a pretext for action, and this all goes rear to the first narrative from final week: that Huang was honeypotted by an alleged Chinese spy. Whatever was going on alongside neocloud Megaspeed power be much, much worse than we know, and what we cognize is beautiful bad: endeavor listings that led to “a Malaysian data center and buying mall, a near-empty agency in Singapore and a dilapidated storefront exterior Kuala Lumpur.”

Even months before the study that Alice “No Relation” Huang, an exec at Megaspeed, was having an matter alongside Huang, there were questions concerning Nvidia’s endeavor in China. The US authorities has placed strict export controls on Nvidia’s high-end chips. Huang claimed in May that as a result, Nvidia has zero percent market portion in China. But additionally in May, short sellers Culper Research published a study in which they wrote, “We accept that in reality, complete 20% of Nvidia’s FY 2026 compute revenues remained driven by China – supported the two by forbidden GPU amusement and Southeast Asian intermediaries.”

Megaspeed was Nvidia’s largest Southeast Asian buyer, but Singaporean newspaper The Straits Times visited Megaspeed’s Singapore agency a duration ago to discover “no signs of activity.” Another construction tenant told the reporters, “It is continually dreary for as lengthy as it has been here. I barely see anyone visiting or in the office.” The sole director of Megaspeed, Tan Yong Pong, appears to have vanished. The Singaporean business that owns Megaspeed, Swiftdata, has listed an agency that belongs to an inner scheme firm as its endeavor address.

Megaspeed is lone part of the story, I think. There are two Chinese chip-related scandals that could logic grave problems for Nvidia, and the two characteristic group alongside near ties to Huang. One is Megaspeed, which involves Huang’s maybe-spy matter partner. The another centers on Super Micro (which, horribly, does endeavor as Supermicro), a partner of Nvidia run by one of Huang’s old friends, Charles Liang. Super Micro’s cofounder, Yih-Shyan “Wally” Liaw, alongside alongside Ruei-Tsang “Steven” Chang and Ting-Wei “Willy” Sun, allegedly defrauded the US by serving as a passthrough for a forefront business to buy $2.5 milliard of Nvidia chips for Alibaba. The forefront company, not named in the indictment, is Thailand-based OBON, according to Bloomberg. Liang and Super Micro have not been charged.

But these incidents may not be the end of Nvidia’s problems. Take for instance, additional recently, New Matrix — another business that barely exists, and yet is an approved buyer of Nvidia chips. It is, in fact, one of multiple approved companies that “have ties to firms that have been blacklisted by the U.S. government, or that activity as armed forces contractors in China,” according to The New York Times.

Huang has insisted that Nvidia has seen “no evidence of any AI part diversion.” He’s been pretty emphatic on that point, actually. I am now wondering if that is equal a small bit true. If the commission is cutting Huang loose, there’s likely additional on part smuggling allegations coming.

Come January, Elizabeth Warren volition be capable to dispatch subpoenas in her function as the place of the Senate Banking Committee. And wouldn’t you know, she seems to be pretty interested. Democrats volition authority the two the House and the Senate. Their voters have stated them a command to base out corruption. And boy howdy, does Nvidia appearance akin a sitting duck correct now. If Huang knew chips were being diverted — or had logic to cognize that — and tried to justify their revenue anyway, he may have committed genuine crimes (bribery, espionage, smuggling, whatever) and, under a functioning lawful system, could really go to jail. Nvidia dispensing alongside its essential CEO is the business reducing its hazard of getting roped into Huang’s drama.

Will it be that uncomplicated for Nvidia? I wonder. The most engaging part of the second matter story, alongside Powell, the Nvidia vice chairman of healthcare, comes at the extremely end of the New York Times article. When person took a video of Powell and Huang being “affectionate” in March, Huang’s safety had nondisclosure agreements prepared to go. CNBC reports that rumors of their affair have circulated “for years.” I amazement what alternatively was an open concealed at the company, you know? Especially since Huang had 60 straightforward reports, so all part of the business is covered in his fingerprints.

Over in the tech world, group motionless appear to be in denial. On X, the social network for Trumpist dead-enders, the document “zerohedge” posted, “Elon delight employ Jensen.” Elon Musk replied, “That would be an honor.”