Once AI darling of shareholders, Nvidia sued by own stock buyers over CEO Jensen Huang affair; $420 bn lost in 2 days

Nvidia Shareholder Suit: What Happened

Nvidia, until recently a favourite of investors riding the artificial intelligence boom, is now facing a class-action lawsuit filed by its own shareholders against CEO Jensen Huang and the company. The suit, lodged in the US District Court for the Northern District of California, alleges violations of federal securities laws. The plaintiffs claim investor losses followed disclosures about Huang's acknowledged affair with Alice Huang, whose former employer, Singapore-based Megaspeed, is under scrutiny over suspected shipments of advanced Nvidia chips into China. Huang has apologised for the affair.

The market reaction was severe. Nvidia shares fell 4.27% on the New York Stock Exchange on Monday, erasing $192.1 billion in market capitalisation in one session. Losses continued on Tuesday, with the stock down another 5.5% to $168.89, taking the company's market value to $4.08 trillion and wiping out over $420 billion across two sessions.

Why It Matters For Businesses

The case sits at the intersection of corporate governance, securities law and national security exposure. According to the Financial Times, Alice Huang and business partner Kang Wei pitched investors in early 2025 for a Southeast Asian data centre project, claiming access to Nvidia's advanced GPUs would be easy despite US export restrictions. Kang was reportedly a director of Guilin Bank, a state-linked lender in China's Guangxi region. Alice Huang reportedly named Alibaba as a prospective customer; Alibaba had extended financing through its Singapore subsidiary to Megaspeed's Malaysian unit in 2024, after which Megaspeed's assets grew from $33 million to $3 billion.

Megaspeed, formerly 7Road International, was spun off and renamed in 2023 and built data centres across Southeast Asia for Chinese clients. US authorities suspected it was a possible channel for moving advanced American chips into China. The Commerce Department began investigating Megaspeed and Alice …